Step back in the sky, Lost Financial Center
Political and economic risks have put Hong Kong stocks in a dilemma. The amendment of the Fugitive Offenders Ordinance has caused Hong Kong to fall into another political crisis. The HSI plunged 480 points yesterday. Hong Kong stocks face a lot of risks. The opportunities for the escalation of Sino-US trade wars are still there. Hong Kong’s interest rates are normalized at this moment. The property market risks have increased. Although US stocks have cut interest rates, the rise on Tuesday has been blocked. The technical trend shows that the market is adjusting. The chances are greater than the chances of continuing to rise. As an investor, I can only hope that the Chief Executive Lin Zheng will focus on the overall situation. Hong Kong must retain its position as an international financial center. It must not ignore the international view of the Hong Kong system. Otherwise, the great cause will be lost.
The revision of the Fugitive Offenders Ordinance has evolved into a revival of the Occupy-China incident. The police will launch tear gas to disperse a large number of demonstrators. The Hang Seng Index closed down 480 points yesterday. Referring to the 2014 occupation movement, the Hang Seng Index fell from 2,024 points on September 25 to 23,137 points on September 30, with a cumulative drop of 891 points. However, the dissatisfaction with the amendments came from a wider class. The age bracket is not limited to the later generations. This amendment is a very important institutional change. The Government should listen to the views of the public. The international community headed by the United States has also expressed concern that Hong Kong is an international financial center and a business center. It cannot be forced to interfere with foreign forces. This will ruin Hong Kong’s economic status for many years.
The amendment is not urgent.
As an investor, the next step of deployment depends on whether Lin Zheng can focus on the overall situation, observe the people’s feelings, put aside the amendments, and make detailed consultations and explanations. Moreover, there is no urgency in the amendments. Vulnerabilities should also consider social costs, strong and costly, why bother? The extradition of murderers in Taiwan and Taiwan’s dissatisfaction with the law are almost certain that the local government will not ask the Hong Kong SAR Government for extradition, and it will not meet the original intention of the Hong Kong Government. Today, when the political and economic situation in the world is in turmoil, the policy of the Hong Kong Government should focus on stabilizing the overall situation. The Chief Executive should take the challenge of uniting society as a priority.
The interbank interest rate in Hong Kong rose across the board yesterday. The one-month interest rate of Hong Kong dollar linked to the property rose to 2.42%, an increase of 0.286%. The increase was quite exaggerated. Some analysts may have to pay dividends in June. Close to the interbank interest rate, and Alibaba is ready to apply for listing in Hong Kong, the bank must prepare for the position.
Short-term fluctuations are easy to find the real reason, however, the one-month interest rate has gradually formed an upward channel since last year [Figure 1], but the recent upswing accelerated. Since the market deepened the expectation of interest rate cuts in the United States, the spread of Hong Kong and the United States has been greatly narrowed. The 12-month forward contract spread, which reflects the spread between the two places, has also been discounted by more than 600 pips from the beginning of the year to a discount of 70 yesterday. In the normal situation, the interest rates of the two places will be quite close. Therefore, the interest rate of Hong Kong can be said to have reached normalization level. The first one will be the mortgage-paying person. The current cap rate of H is 2.375%. There is a cash rebate, according to the yesterday’s interest rate, the bank will do the eclipse according to the eclipse, the bank should cut the cash discount and raise the cap rate, and add the best interest rate (P).
Hong Kong interest rate normalizes when it is not appropriate
When the United States raised interest rates, Hong Kong did not follow suit, creating a bubble in the property market. Now that the economy has turned worse, people have cut interest rates. Instead, I have earned generosity before returning to the economy, and when the economy is good, it raises interest rates. When the economy is bad, the interest rate rises. dead.
US President Trump has been a bit incoherent in recent days. He hopes that there will be a “study meeting" at the end of the month, which will lead to hard and soft tricks. He praised the president of the country, Xi Jinping, who is a great man, a strong man, and a clever one. He did not attend the G20 summit in Osaka, Japan, and held a “Study Conference" to impose a 25% tariff on 300 billion US dollars of Chinese goods, even higher than 25%.
Dealing with the old tricks, please close the door
However, so far, the Chinese officials have no doubt about whether there is a “special meeting". Lao Te has opened the conditions in the morning, and the starting point for resuming negotiations is the conditions discussed before. The Chinese side is naturally too lazy to ignore it. Lao Te has always been a master of negotiation. The best way to deal with him is to close the door of negotiations and wait for him to useless. Anxious.
From the deployment of large enterprises, it can be seen that the Sino-US negotiations are dark, such as Apple’s foundry Foxconn, which shows that once US tariffs affect Apple’s mobile phones, Apple products imported into the United States can be made from production lines outside China, and Google also said that Some hardware production has been moved from China to Taiwan and Malaysia, among which there are reasons for the United States to impose tariffs, as well as products for security reasons such as circuit boards. Enterprises are preparing for a long-term trade war between China and the United States. How can investors have no precautions?
Trump often upgrades the trade war when the market is excited, which makes the stock market friends miserable [Figure 2]. It is difficult to have a long-term performance in the city.