Daily Investment Strategy
Hang Seng Index fell 13 points on Thursday
The Hang Seng Index closed at 17,444 points for the day, down 13 points or 0.1%. The Hang Seng Technology Index reported at 3,487 points, up 4 points or 0.1%. The HSCEI Index fell 28 points, or 0.5%, to 6,105 points. The market turnover was HK$84.9billion.
August non-farm payrolls data weaker than expected
U.S. stocks closed lower on Friday. The Dow Jones index fell 410.34 points, or 1.01%, to 40345.41 points; the Nasdaq index fell 436.83 points, or 2.55%, to 16690.83 points; the S&P 500 index fell 94.99 points, or 1.73%, reported 5408.42 points. All three major indexes saw large declines last week, with the Dow Jones Industrial Average falling 2.93%, the S&P 500 Index falling 4.25%, and the Nasdaq Composite Index falling 5.77%.
In terms of economic data, non-farm payroll data, which the market has been most concerned about recently, was released last Friday. However, this data performance was lower than market expectations and the previous value was significantly lowered, which dragged down the performance of US stocks last Friday. The latest non-farm payroll figures in August were 142,000, and the market expected 161,000; the number of new jobs in June was revised down by 61,000, from 179,000 to 118,000, and the July data was revised down by 25000, revised down from 114,000 to 89,000. The unemployment rate dropped slightly to 4.2% and average hourly earnings increased by 0.4%.
The chance of 50 bps rate cut in September has not increased significantly
After the U.S. released non-farm employment data that was weaker than market expectations, the market's expectations for the Federal Reserve to cut interest rates by 50 basis points in September briefly increased but not last. Short-term U.S. Treasury bonds surged, and the 2-year U.S. Treasury yield fell short-term, closing down 9.3 basis points on Friday. During the day, the market expected that the chance of a 50 basis point interest rate cut had risen to 50%, but in the end, according to the FedWatch tool, the chance of a 50 basis point interest rate cut in September was only 30%.
Hong Kong Stock Connect had a net outflow of HK1.59bn on Thursday of which ICBC (1398) had the largest net inflow, reaching HK$0.25bn; followed by Kuaishou (1024). Tracker Fund (2800) recorded the largest net outflow at HK$1.61bn, followed by CSOP HS TECH (3033).
Wen Kit Kenny is a SFC licensed person accredited to KGI Group to carry on regulated activities (for details, please refer to:https://apps.sfc.hk/publicregWeb/indi/AJF244/details). He and/or his associate do not have any financial interest in the recommended issuer or new listing applicant.
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