ET Net News Agency reported on the 2nd: The Hong Kong stock market has recently come under significant pressure, plunging over 500 points at the opening and subsequently breaking below the 24,000 level. Raymond Wong Wai-ho, First Vice President of Yinyuan World Creation Family Office (Hong Kong), said on ET Net's programme "Open Market Good Morning" that the overall market sentiment is currently leaning conservative and cautious, lacking attractive catalysts for speculation. Regarding external factors, geopolitical tensions such as the US-Iran situation driving oil price volatility, expectations of Federal Reserve rate hikes, and high US Treasury yields continue to weigh on market sentiment, making investors hesitant to enter the market. Additionally, the recently concluded August earnings season failed to provide significant upward valuation catalysts, leaving Hong Kong stocks generally unattractive, resulting in persistently low trading volumes.
Apart from macroeconomic and fundamental factors, the holiday effect is also a major reason for the recent low trading volume and increased volatility. Raymond Wong said that since last Friday (September 25), when northbound funds temporarily halted inflows, although A-shares continued trading over the past few trading sessions, the enthusiasm of northbound funds to absorb Hong Kong stocks has been insufficient. Coupled with the upcoming National Day Golden Week holiday, mainland Chinese stock markets will be closed for nearly a week, meaning that Hong Kong stocks will lack support from northbound funds in the short term, and liquidity is expected to become even tighter. This not only suppresses overall market turnover but also intensifies downward volatility during the opening session. He believes that after the mainland holidays end and funds return, trading volumes and market sentiment are expected to gradually recover.
Regarding technical trends and key support levels, Raymond Wong pointed out that although the recent performance of Hong Kong stocks has not deteriorated extremely, it is certainly not strong. From a technical perspective, if calculating the uptrend from the June low of 22,518 points to the early August high of 26,187 points, the key Fibonacci retracement support level falls at 23,919. As the Hang Seng Index breaks below the support level of 24,352 points, 23,919 points has now become the core defense line.
Raymond Wong further stated that if Hong Kong stocks can successfully hold above 23,919 points, it would mean that the overall uptrend since June has not yet ended, and there remains a chance for the market to bottom out and rebound. However, if this key level is unfortunately breached without sufficient buying support, Hong Kong stocks may face further downside risks, and technically, there is even a possibility of gradually falling back to previous starting levels. Therefore, the 23,919 level will be the most critical indicator determining whether the market can halt its decline and stabilize in the short term. (al)
Apart from macroeconomic and fundamental factors, the holiday effect is also a major reason for the recent low trading volume and increased volatility. Raymond Wong said that since last Friday (September 25), when northbound funds temporarily halted inflows, although A-shares continued trading over the past few trading sessions, the enthusiasm of northbound funds to absorb Hong Kong stocks has been insufficient. Coupled with the upcoming National Day Golden Week holiday, mainland Chinese stock markets will be closed for nearly a week, meaning that Hong Kong stocks will lack support from northbound funds in the short term, and liquidity is expected to become even tighter. This not only suppresses overall market turnover but also intensifies downward volatility during the opening session. He believes that after the mainland holidays end and funds return, trading volumes and market sentiment are expected to gradually recover.
Regarding technical trends and key support levels, Raymond Wong pointed out that although the recent performance of Hong Kong stocks has not deteriorated extremely, it is certainly not strong. From a technical perspective, if calculating the uptrend from the June low of 22,518 points to the early August high of 26,187 points, the key Fibonacci retracement support level falls at 23,919. As the Hang Seng Index breaks below the support level of 24,352 points, 23,919 points has now become the core defense line.
Raymond Wong further stated that if Hong Kong stocks can successfully hold above 23,919 points, it would mean that the overall uptrend since June has not yet ended, and there remains a chance for the market to bottom out and rebound. However, if this key level is unfortunately breached without sufficient buying support, Hong Kong stocks may face further downside risks, and technically, there is even a possibility of gradually falling back to previous starting levels. Therefore, the 23,919 level will be the most critical indicator determining whether the market can halt its decline and stabilize in the short term. (al)
