Daily Investment Strategy

Hang Seng Index rose 237 points on Tuesday

The Hang Seng Index closed at 17,660 points for the day, rose 237 points or 1.4%. The Hang Seng Technology Index reported at 3,536 points, rose 39 points or 1.1%. The HSCEI Index rose 85 points, or 1.4%, to 6,176 points. The market turnover was HK$63.0billion.

S&P 500 ends seven-day winning streak as Fed announces sharp rate cut

U.S. stocks ended lower on Wednesday amid turmoil as the Federal Reserve cut interest rates by 0.5%. The sharp rate cut was initially welcomed by traders, but also raised concerns that the Fed was trying to get ahead of potential economic weakness. The Dow Jones Industrial Average fell 103.08 points, or 0.25%, to close at 41,503.10 points. The index rose as much as 375.79 points after the Fed's decision. The S&P 500 fell 0.29% to close at 5,618.26 points. The Nasdaq fell 0.31% to 17573.30 points. Both the S&P 500 and the Dow Jones initially hit record highs, but have since retreated. Intuitive Machines shares rose 38% after it won a $5 billion contract for lunar communications and navigation services from NASA. Among retail stocks, Victoria’s Secret & Co was a standout, rising 3%, after Barclays upgraded the stock to overweight from underweight, citing a more balanced valuation.

Fed cuts interest rates by a half point

The Federal Reserve lowered the federal funds rate to a range of 4.75%-5% on Wednesday, its first rate cut since the outbreak of the new coronavirus. Federal Reserve Chairman Jerome Powell tried to ease concerns at a press conference after the meeting that the Fed cut interest rates sharply because the upside risks to inflation have declined significantly. Powell said he sees no signs in the economy that indicate an increased likelihood of a recession. The Federal Reserve is expected to cut interest rates by another half point before the end of 2024. The central bank has two more policy meetings to do so.