Daily Investment Strategy
Hang Seng Index fell 39 points on Thursday
The Hang Seng Index fell 39 points or 0.2% to 17,304 on Thursday. HSTECH fell 40 points or 1.1% to 3,476 and HSCEI fell 20 points or 0.3% to 6,086. Daily market turnover was HK$94.1bn.
S&P 500 falls as weak economic data unsettles stocks
The S&P 500 opened under pressure on Thursday as weak economic data brought recession fears back into focus. The Dow Jones Industrial Average fell 669 points, or 1.6%, the S&P 500 fell 2.8%, and the Nasdaq fell 2.8%. Technology stocks followed the broader market lower, although Meta Platform rose nearly 5% on stronger-than-expected second-quarter earnings and upbeat guidance. The results suggest the company's investment in artificial intelligence to improve the effectiveness of its targeted ads is starting to bear fruit. Meanwhile, Qualcomm shares fell 9% as the U.S. revoked an export license for sanctioned Chinese telecoms firm Huawei, hurting its revenue. Meanwhile, chip designer Arm Holdings ADR fell about 16% after the company issued weaker guidance that offset better-than-expected quarterly results. NVIDIA Corporation shares fell nearly 7%, down from the previous day's gains, as investors awaited further news from the chip industry, with Intel set to report earnings after the close. Apple and Amazon are also due to report earnings on Thursday. Shares of drugmaker Moderna fell 21% after the company cut its full-year revenue forecast due to sluggish EU sales and fierce competition in the U.S. vaccine market. The company's shares plunged 11%. Shares of Eli Lilly rose 3% after trial results showed that the weight loss drug Zepbound can reduce the risk of hospitalization, death and other consequences in obese adults with a common form of heart failure.
Weak U.S. economic data sparks economic panic ahead of non-farm payrolls data
The initial jobless claim in the week of July 27 increased to 249,000, higher than expected, while the ISM manufacturing index in July was 46.8, lower than expected and lower than June's 48.5. The two reports heightened concerns about an economic downturn even as the Federal Reserve is expected to cut interest rates in September. The 10-year U.S. Treasury yield fell below 4% for the first time since February as concerns about an economic hard landing resurfaced.
Hong Kong Stock Connect had a net inflow of HK8.37bn on Thursday of which Tracker Fund (2800) had the largest net inflow, reaching HK$2.0bn; followed by HSCEI (2828). HSBC (5) recorded the largest net outflow at HK$0.28bn, followed by Shenhua (1088).
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