Hang Seng Index: What's next as it erases previous gains?
The Hang Seng Index might be headed for a period of consolidation, now that all major global events are behind us.
It was an underwhelming start to the week for the Hang Seng Index.
After hitting an eight-month high last Monday and again briefly in early trade this morning, the benchmark then went on a downward slide, losing 0.52% by 9.50am on Monday morning (20 January), before falling some more to finish the day at a low of 28,795.91.
Consolidation at 28,500 points?
If that is not an indicator that the Hang Seng’s run of good fortune might be coming to an end in the interim, one market watcher is expecting the index to fall further and stabilise around 28,500 points.
That’s according to Alan Li, portfolio manager at investment management firm Atta Capital, who explained that the market is back in regular mode, with the phase-one US-China trade deal already concluded and no new geopolitical event on the horizon.
‘All good news has come out already, and there is not much stimulus that the market can expect in the near future,’ he told South China Morning Post.
Furthermore, he said investors were also likely reacting to the country’s central bank announcement this morning to keep its one-year loan prime rate unchanged at 4.15% for January from the previous month.
Take advantage of rising and falling prices on the Hang Seng Index with an IG demo account today.
Biggest losers and gainers
Hong Kong property developers found themselves driving much of the short selling momentum, with all 11 listed companies either trading flat or negatively. China Overseas Land & Investment Limited was down as much as 2.87% to HK$28.80 from a starting price of HK$29.50, China Resources Land Limited lost 2.81% to HK$36.35, and Country Garden Holdings Co Ltd erased 2.15% to finish the day at HK$11.82.
Meanwhile, tourism-related and hospitality stocks were also hit hard, with the Wuhan pneumonia virus outbreak negatively impacting (or expected to) travel and visitor numbers.
In aviation, Air China descended as much as 7.6 per cent to HK$7.20, while China Eastern Airlines fell seven percent to HK$3.98. In leisure and entertainment, Macau casino operator SJM Holdings Limited lost 6.7% of its share value, while MGM China Holdings Limited shed six percent to HK$13.88.
In positive news, the biggest gainer of the day was Sino Biopharmaceutical Limited with a five percent share price rally; followed by China Mobile Limited, which saw share value rise 3.7% on the day; and finally China Life Insurance Co Ltd, which added nearly one percent to market valuation.
Learn how you can trade the Hang Seng Index and other indices with a free IG demo account today.
This information has been prepared by IG, a trading name of IG Limited. In addition to the disclaimer below, the material on this page does not contain a record of our trading prices, or an offer of, or solicitation for, a transaction in any financial instrument. IG accepts no responsibility for any use that may be made of these comments and for any consequences that result. No representation or warranty is given as to the accuracy or completeness of this information. Consequently any person acting on it does so entirely at their own risk. Any research provided does not have regard to the specific investment objectives, financial situation and needs of any specific person who may receive it. It has not been prepared in accordance with legal requirements designed to promote the independence of investment research and as such is considered to be a marketing communication. Although we are not specifically constrained from dealing ahead of our recommendations we do not seek to take advantage of them before they are provided to our clients.
CFDs are a leveraged products. CFD trading may not be suitable for everyone and can result in losses that exceed your initial deposit, so please ensure that you fully understand the risks involved.
Seize your opportunity
Deal on the world’s stock indices today.
- Trade on rising or falling markets
- Get one-point spreads on the FTSE 100
- Unrivalled 24-hour pricing
See opportunity on an index?
Try a risk-free trade in your demo account, and see whether you’re on to something.
- Log in to your demo
- Try a risk-free trade
- See whether your hunch pays off
See opportunity on an index?
Don’t miss your chance – upgrade to a live account to take advantage.
- Get spreads from one point on the FTSE 100
- Trade more 24-hour indices than any other provider
- Analyse and deal seamlessly on smart, fast charts
See opportunity on an index?
Don’t miss your chance. Log in to take your position.
Live prices on most popular markets
- Forex
- Shares
- Indices
Prices above are subject to our website terms and agreements. Prices are indicative only. All shares prices are delayed by at least 15 mins.
