Stock market investors may have eased their concerns about aggressive interest rate hikes by the Federal Reserve, with the Hang Seng Index (HSI) surging again on Friday amid a recovery in global stock markets. Technically, if the Hang Seng Index can further break through the resistance of the 20-day moving average near the top, it will gain more room for growth.
The preliminary data of the first quarter GDP released by the United States overnight took the market by surprise. The data showed that the initial value of the annualized quarterly rate of the U.S. GDP in the first quarter was -1.4%, while the expected growth rate was 1.1%, which also means that the U.S. economy will grow by 2020. This was the first quarterly contraction since the second quarter of 2018. Breakdown data showed that exports and inventories were the main drag on the U.S. economy in the first quarter.
Although there was no significant change in the interest rate and swap market expectations for the Fed to raise interest rates next month or this year after the weak U.S. GDP data was released, it still eased the worries of stock market investors, triggering the largest single-day gain in U.S. stocks in three months. On Thursday, the S&P 500 rose 2.47%, the Nasdaq rose 3.06% and the Dow rose 1.85%.
The outstanding performance of the Hang Seng Index (HSI) on Friday was not only driven by the external market but also related to today’s news from China. The meeting convened by the Political Bureau of the Central Committee to study the economic situation emphasized that it is necessary to promote the healthy development of the platform economy, complete the special rectification of the platform economy, implement normalized supervision, and introduce specific measures to support the standardized and healthy development of the platform economy. The news has a significant stimulating effect on Internet stocks in the Hang Seng Index and Hang Seng Technology Index.
The Hang Seng Index (HSI) opened slightly lower by 0.1% on Friday, and the market rose near the end of the morning session and at the beginning of the afternoon session, to close up 4.01%. In addition, the Hang Seng Technology Index rose nearly 10%, led by Internet technology stocks.
On Friday, 42 stocks in the Hang Seng Index (HSI) rose, 22 fell and 2 were unchanged. The top three top performers were: Alibaba, up 15.69%; JD.com, up 15.68%; and Meituan, up 15.51%. The top three worst-performing stocks were: Hang Lung Properties, down 5.06%; WH Group, down 2.68%; and Power Assets, down 2.49%. The major heavyweights performed as follows: Tencent Holdings rose 11.06%; Alibaba rose 15.69%; China Construction Bank fell 0.18%.
Hang Seng Index (HSI) Technical Analysis
The daily chart shows that the Hang Seng Index soared by more than 800 points after confirming the support of 20,000 points, and closed close to the key resistance 20-day moving average of 21220. If the resistance can be effectively broken, it may open up more room for growth, and it is expected to rise to 22,000. And around 22,500, the high in early April. If there is a fall, the following will focus on 20700-20800 regional support, and further support will focus on 20500.
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