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Last Week
U.S.
Stocks retreated the
week as investors worried about the pace of growth. Stocks opened higher as
boosted by strength in financial and select technology shares. However, the
market was hit hard Thursday on a drop in oil prices and a rise in the
dollar, which caused broad weakness in a number of commodity and materials
stocks sectors that had propelled the recent advance. For the week, the Dow
Jones slid 205 points, or 2% to 10,345.40, the S&P 500 fell 17 points, or
1.5% to 1,154.05, while the Nasdaq gained 9 points or 0.5% to 1,976.78.
Hong
Kong
Stocks retreated the
week to close below the psychological level of 14,000-point. Following United States and other Asian markets, which
concerned that high crude oil prices, investors preferred to take profit. The
benchmark index continuously dropped Friday as hurt by falling world oil
prices and market digested effect of a possible currency revaluation on money
flows. For the week, the HSI slid 205 points or 2% to 10,140.12. Average daily turnover was thin at
HK$13.26 billion.
This
Week
U.S.
Ø On Mon 16/05, stocks snapped
back the session, rallying soundly after last week・s big sell-off amid
strength in retail and financial. The Dow Jones gained 112 points to
10,252.29, the S&P 500 rose 11 points to 1,165.66, and the Nasdaq added
17 points to 1,994.43.
Ø On Tue 17/05, stocks staged
a late rally after the US issued its toughest warning to China on currency yet, saying China will be named a manipulative
trading partner unless it makes the RMB more flexible. The Dow Jones gained
79 points to 10,331.88, the S&P 500 rose 8 points to 1,173.80, and the
Nasdaq added 9 points to 2,004.15.
Ø On Wed 18/05, stocks
rallied for a third straight day as a mild inflation report cheered the bulls
and cooled worries that the Federal Reserve would need to speed up its
rate-hiking campaign. The Dow Jones soared 132 points to 10,464.45, the
S&P 500 gained 11 points to 1,185.56, and the Nasdaq rose 26 points to
2,030.65.
Ø On Thu 19/05, stocks rose for the fourth
straight day as strength in the technology sector gave the broader market a
push near the close. The Dow Jones gained 28 points to 10,493.19, the S&P
500 rose 5 points to 1,191.08, and the Nasdaq added 11 points to 2,042.58.
Ø On Fri 20/05, stocks
performed mixed, as blue-chips inched lower, techs closed higher as markets
stabilize at end of upbeat week. The Dow Jones slid 21 points to 10,471.91,
the S&P 500 inched down 1 point to 1,189.28, and the Nasdaq
rose 3 points to 2,046.42.
For the week, the Dow was up around 331 points, or 3.27%,
the Nasdaq was up around 69 points, or 3.5%, and the S&P index was up
around 35 point, or 3%.
Hong
Kong
Ø On Mon 16/05, stocks closed
for Buddha・s birthday holiday.
Ø On Tue 17/05, stocks
slumped as investors worried about capital outflows as speculation over
revaluation of the yuan cools off. Shipping-related counters took the lead in
session・s sell-off. The selling put downward pressure on the index
heavyweights, including China Mobile, HSBC, Hutchison Whampoa and Sun Hung
Kai Properties. The HSI slid 199 points to 13,667.03,
turnover was HK$17.67 billion.
Ø On Wed 18/05, stocks fell
for the third day as investors continued to fret about fund outflows and
reconsidered earlier bets of a near-term revaluation of the yuan. HSBC
accounted for a large portion of drop as the stock started to trade without
the right to a dividend of about $1.09. Shipping stocks were among the
biggest losers for the second day. The HSI fell 40 points to 13,627.01.
Turnover was HK$14.7 billion.
Ø On Thu 19/05, stocks ended
a three-day slump following Wall Street surge, better US consumer price data and retreat
in crude prices. China Mobile had the largest positive effect on the key
index, rising 1.51% to $26.75. Banking sectors gained after raising the prime
lending rate from 5.25% to 5.75%. The HSI gained 71 points to 13,698.93.
Turnover slightly increased to HK$15.46 billion.
Ø On Fri 20/05, stocks
managed slightly higher as investors worried about the impacts of rising
interest rates and a stronger US dollar. China Mobile took the lead among the
blue chips, rising 0.35% to $27.1. But property stocks remained under
pressure after Hong Kong raised their lending rates by 50 basis points. The HSI gained 18
points to 13,717.42. Trading was thin at HK$10.75 billion.
For the week, the Hang Seng Index decreased 149 points or
1.07%.
Conclusions and Predictions of Next Week
US stocks rebounded
the week with strong gains in all three major gauges. The broad-based advance
was sparked by falling oil prices, and investors・ belief that inflation is
contained enough so the Federal Reserve won・t have to speed up the pace of
its rate-hiking campaign. However, there was a little break Friday as lack of
big earnings or economic news. Stocks enjoyed a strong week, with all three
major gauges rising through the first four sessions. For the week, the Dow
Jones soared 331 points or 3.27% to 10,140.12, the S&P 500 gained 35
points, or 3.05% to 1,189.28, and the Nasdaq rose 69 points or 3.52% to
2,046.42. For next week, market ．s focus will likely be the slew of economic
reports that are due, including reports on existing and new home sales, as
well as the minutes from the most recent Federal Reserve policy-setting
meeting.
Hong Kong stocks continued the downward
momentum this week as concern of fund outflow. The market opened lower and
fell for two sessions in a row as investors worried about capital outflows
and reconsidered earlier bets of a near-term revaluation of the yuan.
Thereafter, following Wall Street surge and interest rates, stocks managed
gains for the later two sessions. China Mobile performed well rising to $27.1
after announcing it added 3.232 million users last month. On the other hand,
property counters were under pressure after Hong Kong banks raised their lending rates.
Sun Hung Kai Properties fell to $73.5, Cheung Kong was down to $70 and
Henderson Land Development shed to $34.80. For the week, the HSI slid 149 points
or 1.07% to 13,717.42. Average daily turnover was fair at HK$14.64 billion.
The Hang Sang Index is likely to
be stuck in a range as investors digest the potential negative fallout from last
week・s sharp increase in money market rates and a 50 basis point rise in bank
lending rates. Investors are moving out of interest-rate-sensitive stocks and
into China shares as lingering expectation
of a yuan revaluation. The benchmark index is expected to continue to hover
between 13,500 and 13,850 points.
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