Investment 6/6/2024

After the Hang Seng Index opened 45 points higher at 18,489 points, the increase once expanded to 280 points, reaching a high of 18,724 points. Later, it encountered resistance at the high level and turned from rising to falling. It fell 19 points or 0.1% for the whole day to 18,424 points, ending the two-day rising trend.  The technology index rose 11 points, or 0.3%, to 3,807 points. Main board transaction volume was HK$115.6 billion. 

Yesterday, the Hang Seng Index rose to close to the top of the fluctuation range of 18,700 points, and investors took profits from selling. The Hang Seng Index fell back from a high of 19,706 points last month and rebounded after hitting a low of 18,077 points. It is expected that the Hang Seng Index will continue to rise and fall in the range near the central axis of the Bollinger Channel and the 20-DMA (18,809). If the market value of the Hong Kong stock market is calculated based on a price-to-earnings ratio of 9 times, the current value target of the Hang Seng Index is 18,500 points. Therefore, it is expected that the market outlook is likely to be a "volatility, no increase" pattern. The Hong Kong stock market's upside and downside space are limited. When the market is at a low point, the mainland government may implement a series of favorable policies to drive a rebound, but it will not be a long-term upward trend. 

China's official manufacturing PMI in May was worse than expected, while Caixin China's services PMI was better than expected. There is a conflict between the two, so the market has reservations about the direction of mainland economic data. There are still variables in the direction of U.S. interest rates, so it is not advisable to follow the trend too closely.

 European stock markets performed well across the board, with German stocks closing nearly 1% higher and performing better, while British and French stocks rose 0.18% and 0.87%. 

The latest economic data in the United States were mixed, with the market continuing to expect the Federal Reserve to cut interest rates later this year. The Dow Jones Industrial Average had a mixed performance on Wednesday, falling more than 100 points before recovering. Heavyweight technology companies performed significantly better, driving the Nasdaq to rise by about 2%. Together with the S&P 500, it hit a record closing high. The Dow opened 63 points higher and fell as much as 162 points to a low of 38,548 points. It then rose 133 points and reached a high of 38,844 points. It closed up 96 points or 0.25% at 38,807 points; the S&P 500 index rose for 4 consecutive transactions. Today, it rose another 62 points or 1.18% to 5,354 points; the Nasdaq, which is dominated by technology stocks, rose 330 points or 1.96% to 17,187 points. 

The U.S. dollar index rose as much as 0.34% to 104.46; the yen plunged 1.03% to 156.48 per dollar. The European Central Bank is expected to cut interest rates on Thursday, and the euro rose 0.11% to $1.0894.