The Hong Kong stock market experienced a setback on Tuesday, ending a two-day upward trend that saw a rise of over 850 points or 4.2%. Currently, the Hang Seng Index stands slightly above the 20,310 mark and anticipates a subdued opening on Wednesday.
Globally, the forecast for Asian markets suggests a downtrend, impacted by expected weaknesses in the computer, semiconductor, and housing sectors. Both European and U.S. markets showed downward trends, which are likely to influence Asian markets similarly.
On Tuesday, the Hang Seng recorded a modest decline, affected by losses in the oil and insurance sectors, alongside mixed results in technology and property sectors. The index fell by 102.81 points or 0.50%, closing at 20,311.28, after fluctuating between 20,308.86 and 21,070.05.
Among active stocks, Alibaba Group decreased by 0.35%, Alibaba Health Info by 1.83%, and ANTA Sports by 0.90%. China Life Insurance saw a sharp decline of 3.21%, while China Resources Land dropped by 2.23%. Other notable movements included CITIC (down 1.41%), CNOOC (down 1.66%), and CSPC Pharmaceutical (down 1.75%). Conversely, Galaxy Entertainment slightly increased by 0.55%, and JD.com rose by 0.72%. Stocks like Meituan and New World Development experienced slight upward movements, while companies like WuXi Biologics saw a significant drop of 3.89%. Notably, China Mengniu Dairy, Industrial and Commercial Bank of China, and Xiaomi Corporation remained unchanged.
Wall Street offered a weak lead, with major indices opening flat and then declining towards the end of the session. The Dow Jones decreased by 154.10 points or 0.35% to 44,247.83, the NASDAQ fell by 49.45 points or 0.25% to 19,687.24, and the S&P 500 dropped by 17.94 points or 0.30% to 6,034.91.
This downturn in Wall Street was attributed to profit-taking by traders, anticipating the Labor Department’s forthcoming report on consumer price inflation. While it is anticipated that the Federal Reserve will cut rates by 25 basis points next week, the imminent data release could influence the forecast for subsequent rate adjustments.
According to CME Group's FedWatch Tool, there is an 86.1% probability of a quarter-point rate cut next week, yet a 69.1% likelihood that rates will remain unchanged by late January.
In commodity markets, oil futures rose on Tuesday, driven by optimism that China’s demand might increase following recent stimulative measures from the Chinese government. West Texas Intermediate Crude futures for January closed higher by $0.22 or 0.32% at $68.59 per barrel.
