Investors in the “super week” face the joint impact of interest rates of the US, European and British central banks and the US stock earnings season. The Hang Seng Technology Index has shown signs of stopping its rise after consecutive rebounds, but it is not afraid of a callback under the background of the market’s overweight Chinese assets.
The Hang Seng Technology Index (HSTECH) adjusts its constituent stocks at the end of each month, and the latest update time is December 31, 2022. After adjustment, the three companies with the largest proportion since January 2023 are: Kuaishou, Tencent Holdings and Meituan. The stock prices of these three companies have the greatest impact on the trend of the Hang Seng Technology Index.
Hong Kong stocks continue to be affected by the trend of mainland China and US stocks. Under the dominance of the mainland market, the external market may still affect the short-term sentiment of Hong Kong stocks.
Overseas, the Federal Reserve decided to raise interest rates by 25 basis points on Wednesday, which was in line with market expectations. Investors were encouraged by the fact that the Fed expressed relief at the cooling of inflation. Although Powell emphasized that it will continue to raise interest rates, investors tend to think that the June meeting will be the earliest Then the Fed will stop raising interest rates.
The expectation of the future monetary policy shift stimulated the dollar to fall, and the gold, stock market and cryptocurrency markets were jubilant. Following Tesla’s outstanding performance last week, the Nasdaq strengthened its rebound after Meta announced a $40 billion repurchase plan, which is conducive to short-term market sentiment heat up.
After a good start to the month, the market is focused on the quarterly earnings reports of Apple and Amazon after the U.S. stock market closed on Thursday. As a consumer giant, Apple has a great influence on the U.S. economy, and Apple’s market value occupies a place in the three major U.S. stock indexes. It can be said that the fluctuation of Apple’s stock price directly affects the direction of U.S. stocks.
On the mainland, China’s stock market is running at a recent high level. Foreign investors are firmly increasing their positions, but domestic investors have different opinions. The short-term market sentiment is changing, and the expectation for the whole year is still optimistic. Changes in short-term sentiment have affected the trend of Hong Kong stocks. If a correction is initiated, the limited pace of the correction will not affect the overall situation. Next, the market will continue to focus on consumption recovery, economic momentum and the “two sessions” in March.
HSTECH maintains a volatile upward trend, and the 2650 trend line is still valid. In the short term, we need to pay attention to the support of the index. It will continue to be stable above 4400, and it will still be strongly bullish. If it falls below 4400, it may trigger a further correction. Looking back at 4200, as long as it does not fall below 4000, the rally will be unbeaten. If the market outlook breaks through 4800, it will look above the 5000 mark.
In the long run, the valuation of Hong Kong stocks is low, and the Hang Seng Technology Index has concentrated the best technology and Internet stocks in Hong Kong. Macro fundamentals are undergoing new changes, especially the Fed’s interest rate hike expectations are weakening, China’s economic momentum has re-gathered after the relaxation of epidemic prevention and control, and foreign capital has re-priced the Chinese and Hong Kong stock markets. ETFs are preferred. The index is still at a relatively low level while the fixed investment in the early stage continues to make profits. It is advisable to consider holding it firmly and wait for the market to continue to rise.
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