Looking forward to easing the political situation HSI rises 397 points Analysis

internal and external situation should not be too optimistic


Hong Kong district council elections were successfully held on Sunday, with more than 85% of the unformed camp gaining market expectations. The market expects that the government can respond to citizens’ demands and alleviate social conflicts that have become more intense in recent months. The Sino-US trade agreement, the improvement of the atmosphere led to the good performance of Hong Kong stocks yesterday. The Hang Seng Index opened higher and challenged the 27,000 mark, reaching a maximum of 27,114 points, but then recovered slightly and closed at 26,993 points, up 397 points or 1.5%. Analysis believes that the local situation and Sino-US trade negotiations still have variables, and should not be overly optimistic. The Hang Seng Index closed at 27,033 at 10:45 last night, with a high of 40 points. Ming Pao reporter Ouyang Weizheng

Social conflicts in Hong Kong have lasted for nearly half a year, and the non-establishment factions have seized control of almost all district boards with the highest turnout in Hong Kong’s electoral history.

Lin Yingji, head of the investment research department of CEB International, said that some analysts believe that the election results reflect the demands of the districts for improving people’s livelihood and the economic environment. If the government responds to these demands, it will help ease the local situation and help reduce violent conflicts.

Local stocks rise, Wharf Real Estate up nearly 5%

The H-Share Index closed at 10,628 points yesterday, up 1.17%, with a turnover of 76 billion yuan. The easing social sentiment favored the performance of local real estate stocks. Wharf Real Estate (1997) rose 4.68%. For the best blue chip performance, Sun Hung Kai Properties (0016) rose 2.98%.

Retail stocks were also doing well. Sa Sa International (0178) rose 5.75%, and Life International (1212) rose 3.45%. The trade talks were good news. Shenzhou International (2313) rose 3.15%, Wanzhou (0288) rose 1.83%, and Techtronic Industries (0669) rose 1.35%.

Zhongsheng Pharmaceutical (1177) fell by 1.95%, being the blue chip with the largest decline. In terms of transaction stocks, all shares of Hongsheng International held by Accor (3313) ‘s major shareholder and Chairman Wu Jing’s husband, Liang Jiajie, were forced to close out on Thursday and Friday, and closed up 117.8% yesterday.

China Feihe (6186) clarified that GMT Research’s allegations were unfounded or misrepresented, and the shares rose 10.5% after the resumption of trading.

It depends on how the government responds

Su Peifeng, a strategist at China Merchants Bank International Research Department, said that the market had earlier worried that the election could not be held, but no major conflicts occurred in the end. This is a favorable factor, which has led to a large rebound in local stocks and a rise in risk appetite. How to respond, whether President Trump will sign the Hong Kong Bill of Rights and Democracy and the prospects of the China-US trade agreement.

HSI rebounds multiple times, subject to 20 antennas

The HSI lags back from above 27,800 points in the middle of the month, and its rebound has been constrained by the 20-antenna level of about 27,000 points several times. Zhiyao Hui, director of the research department of Bright Talent Securities, pointed out that although the easing of the atmosphere has led to a good rebound in local stocks, the situation in Hong Kong is not the first sign of easing. It is still unknown whether the worst time has passed, and the Sino-US trade talks have repeatedly occurred from time to time. The above two factors are still uncertain and will still plague the market in the future. It should not be too optimistic now.


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