Daily Investment Strategy
HSI fell 369 points on Thursday
The Hang Seng Index opened 185 points or 1% lower at 18,930 points on last Thursday, and finally closed down 369 points at 18,747 points . The market turnover was HK$ 115.5 bn. Xiaopeng (9868)'s quarterly results were not satisfactory, and its share price fell 9.3% throughout the day. Xiaomi Group (1810) turned losses into profits in the first quarter of this year, earning RMB 4.204 billion, exceeding market forecasts. The stock price bucked the trend and rose 1%.
PCE picks up
U.S. stocks closed higher on Friday. The Dow rose 329 points, or 1%, to 33,093; the Nasdaq rose 278 points, or 2.2%, to 12,976; the S&P 500 rose 54 points, or 1.3%, to 4,205 point. The performance of the whole week was only the Dow Jones Index fell. There are two items that market traders are focusing on last Friday, the first is the Fed's PCE inflation indicator, and the second is the US debt ceiling agreement.
Firstly, the U.S. Consumer Expenditure (PCE) price index rose by 4.7% year-on-year in April, slightly higher than market expectations and the previous value of 4.6%. The rebounds of the value might reflect that consumption is still hot, and the market's probability of raising interest rates in the future has risen by 25 pips to 64.2%. The market has reversed its view that the US will not raise interest rates earlier, but ultimately it is still necessary to consider whether the pressure on banks will further deteriorate as a consideration. In addition, the United States today will be closed for a day due to a holiday.
Preliminary agreement on debt issues progresses
On the issue of the debt ceiling, news as of Saturday indicated that the White House and Republican negotiators reached a preliminary agreement on raising the US debt ceiling on Saturday, and pointed out that the framework agreement is being completed, and the final bill will be voted on in Congress on Wednesday. In addition, Treasury Secretary Yellen warned earlier that the ceiling increase agreement must be completed before June 5, otherwise it will cause a series of negative effects. But according to the current news of the negotiations between the two parties, the situation is gradually improving.
Last Friday, the market was closed for a day due to holiday, and Hong Kong Stock Connect had a net inflow of HK$ 7.2 billion on Thursday. Among them, Tracker Fund (2800) had the largest net inflow of 4.37 billion Hong Kong dollars; followed by Hang Seng China Enterprises (2828). China Construction Bank (939) recorded the largest net outflow of HK$340 million, followed by CNOOC (883).
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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