The diminishing marginal effect of the Fed’s interest rate hike continued to promote the recovery of Hong Kong stocks. The emergence of ChatGPT has aroused the world’s attention to the innovation of AI technology. The main constituent stocks of the Hang Seng Technology Index have plans for this, and market speculation is conducive to the continued upward trend of the index.
The Hang Seng Technology Index (HSTECH) adjusts its constituent stocks at the end of each month, and the latest update time is January 31, 2023. After adjustment, the three companies with the largest proportion since January 2023 are: Alibaba, Tencent Holdings and Xiaomi Group. The stock price fluctuations 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 the US stock market. The strong performance of US economic data may have an impact on the Fed’s interest rate hike path. Investors are waiting for next week’s CPI and other US inflation data guidance.
Overseas, the U.S. dollar rose after being stimulated by strong non-farm payrolls, and is currently entering a high sideways market, waiting for the guidance of next week’s data; and the key company performance of the U.S. stock earnings season has also been announced in the first two weeks, and the short-term impact of the earnings season on U.S. stocks is also weaken. The influence of the external market gradually weakened.
On the mainland, the stock markets in China and Hong Kong experienced a short-term adjustment and may rise again. The overall market sentiment is still under the expectation of economic momentum gathering, and even if it falls, it will recover soon.
ChatGPT is a popular topic recently, and it has the potential to become another revolutionary technological upgrade after the Iphone. It has a wide range of application scenarios and has a huge impact on the human world. The technical reserves and business expansion around ChatGPT have become a hot spot for market speculation.
The constituent stocks of the Hang Seng Technology Index are dominated by science and technology stocks. Companies follow the trend and continue to release relevant information to the outside world, which arouses investors’ speculation that the stock price fluctuations of companies such as Alibaba will boost HSTECH. It is advisable to keep track of the direction of events.
For more content and knowledge about ChatGPT, please refer to the Dailyfx article What is ChatGPT? What are the ChatGPT concept stocks?
The chart comes from the IG trading platform
HSTECH keeps fluctuating upwards, and 4400 is still the key support. Above this index will maintain a strong consolidation and is expected to continue to rise. Breaking through 4800 in the market outlook will test the 5000 mark. If the Hang Seng Technology Index falls below 4400, it may confirm a callback, and then start a shocking downward trend. The reference support below is 4000.
After the sharp decline in the past two years, the valuation of Hong Kong stocks was low. The Hang Seng Technology Index has concentrated the best technology and Internet stocks in Hong Kong, and has great potential for rebound and rise. The important thing is that new changes are taking place in the macro fundamentals, especially the Fed’s interest rate hike cycle is approaching the end, while China’s economic momentum is gathering again, foreign capital is re-pricing the Chinese and Hong Kong stock markets, and the most difficult time for the Hong Kong stock market has passed. Index ETFs are preferred. The long positions established in the previous round of slump continue to make profits, but the index is still at a relatively low point. It is advisable to consider firm holding and continued fixed investment, waiting for the market to continue to rise.
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Inflation continues to fall, the Fed’s interest rate hike expectations are lowered, but the U.S. stock market always returns in vain. What is the problem?
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