Daily Investment Strategy
Hang Seng Index fell 774 points on Tuesday
The Hang Seng Index closed at 20,318 points for the day, fell 774 points or 3.7%. The Hang Seng Technology Index reported at 4,450 points, fell 217 points or 4.7%. The HSCEI Index fell 302 points, or 4.0%, to 7,277 points. The market turnover was HK$261.2billion.
U.S. stocks fall as earnings reports from LVMH and ASML raise concerns about global economic slowdown
Stocks fell sharply on Tuesday, pausing an earlier rally as traders digested the latest corporate earnings reports. The Dow Jones Industrial Average fell 324.80 points, or 0.75%, to close at 42,740.42 points. The S&P 500 fell 0.76% to close at 5,815.26 points, and the Nasdaq Composite fell 1.01% to close at 18,315.59 points. ASML shares plunged 16% as the chip maker suffered heavy losses. The company's chief executive warned customers to be "cautious" and said the “recovery is more gradual than previously expected.” Nvidia and AMD fell 4.7% and 5.2% respectively. The VanEck Semiconductor ETF (SMH) fell 5.4%, its worst performance since September 3. In addition, UnitedHealth shares fell 8.1% as the company lowered its full-year profit forecast. The insurance company's decline weighed on the Dow. Currently, third-quarter results have been announced for about 40 S&P 500 companies. Among them, 80% exceeded analysts' expectations (from FactSet). The banking industry has attracted much attention. Goldman Sachs exceeded expectations in its third-quarter results. The Global Banking & Markets was a key driver of strong performance, with quarterly net income reaching US$8.55 billion. The stock closed slightly down 0.07% that day. Shares of Bank of America rose 0.6% as the bank's net profit per share beat expectations, as higher investment banking fees helped offset a slight year-over-year decline in net interest income. Elsewhere, shares of Walgreens Consolidated rose 15.8% as the drug chain operator said it will close 1,200 stores over the next three years as part of a restructuring and narrowly beat Wall Street's lowered estimates for fourth-quarter adjusted profit.
Crude oil prices fall on demand concerns
Oil prices fell sharply on Tuesday, exacerbating recent losses, on growing concerns about slowing demand growth, especially from China. Those concerns were heightened by the OPEC cutting its oil demand outlook for a third straight month. Oil prices also fell after reports on Monday that Israel would not attack Iran's oil and nuclear facilities. Markets had earlier expected this to mark a major escalation in the conflict and make investors worried about oil supply disruptions.
Hong Kong Stock Connect had a net inflow of HK8.54bn on Tuesday of which Tracker Fund (2800) had the largest net inflow, reaching HK$6.42bn; followed by HSCEI ETF (2828). Meituan (3690) recorded the largest net outflow at HK$1.81bn, followed by Tencent (700).
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