Investment 16/5/2024

Hong Kong stocks rose first and then retreated before the Buddha's birthday holiday. After the Hang Seng Index opened 88 points higher at 19,203 points, the gain once expanded to 186 points, reaching a high of 19,301 points, setting another nine-month high. However, it later encountered retreating pressure and closed down 41 points or 0.21% at 19,073 points. Three consecutive gains; technology stocks outperformed the market, with the technology index rising 22 points or 0.56% to 4,041 points. Main board transaction volume was HK$143 billion. 

The Hong Kong stock market fell slightly due to overbought conditions and still maintained the 19,000 level. If there is an adjustment in the market, last Friday's rising gap (18,560 to 18,657) is expected to have strong support. After consolidation, the Hang Seng Index has a chance to test 19,650 points. Looking at the market outlook for an optimistic scenario: the Hang Seng Index’s low in October 2022 and the low in January this year formed a head and shoulders bottom pattern, with the neckline at 22,500, which can be used as a midline target. China's Ministry of Finance announced this year's special treasury bond issuance schedule. The market is looking forward to the mainland's economic stimulus policies, which will be positive for the market sentiment in the short term. 

European stock markets remained stable, with British, French and German stocks rising 0.21%, 0.17% and 0.82% respectively.

 U.S. core inflation in April hit a three-year low on an annual basis, and expectations for a Federal Reserve interest rate cut have once again increased. U.S. stocks performed significantly better on Wednesday. After the Dow opened 56 points higher, the increase expanded to as much as 376 points, reaching a peak of 39,935 points; the S&P 500 index It climbed to 5,300 points for the first time in history, rising 1.24% to 5,311 points, setting a new high in the market; the Nasdaq, which is dominated by technology stocks, broke its top for the second consecutive time, once rising 1.44% to 16,749 points. 

At the close of the U.S. market, the Dow rose 349 points, or 0.88%, to 39,908 points; the S&P 500 rose 61 points, or 1.17%, to 5,308 points; the Nasdaq rose 231 points, or 1.4%, to 16,742 points. The three major indexes closed at record highs. 

The U.S. dollar exchange rate came under pressure, with the U.S. dollar index falling 0.67% to 104.31; the Japanese yen once rose 1.11% to 154.69 per U.S. dollar, with a high of HK$5.0485 per 100 yen. The Euro rose by up to 0.61% to $1.0886. The European Commission predicts that the Euro zone’s economy will grow by 0.8% and 1.4% in 2024 and 2025 respectively, which is almost unchanged from the forecast three months ago. Inflation is expected to fall to 2.5% this year and next. % and 2.1%, lower than the previous estimates of 2.7% and 2.2%.