FX.co ★ Hong Kong Stock Market Tipped To Return To The Upside

Ahead of Monday's holiday for SAR Establishment Day, the Hong Kong stock market had seen a slight upward movement, rebounding from a previous two-day winning streak that had added over 60 points or approximately 0.3%. The Hang Seng Index currently sits just below the 17,720-point mark, with expectations for a strong opening on Tuesday. The global forecast for the Asian markets indicates minimal movement, with significant U.S. employment data scheduled for later this week. Both European and U.S. markets concluded slightly higher, suggesting a similar outcome for Asian markets.

On Friday, the Hang Seng closed marginally higher, reflecting gains in energy companies, weakness in technology stocks, and mixed results in the property sector. Specifically, the index increased by 2.11 points or 0.01%, ending at 17,718.61 after fluctuating between 17,583.19 and 17,865.47. Among the active stocks, Alibaba Group decreased by 1.47%, Alibaba Health Info and ANTA Sports both fell by 1.57%, and China Life Insurance dropped by 0.72%. Additionally, China Mengniu Dairy slumped by 2.23%, while CITIC rose by 2.16%. CNOOC saw a substantial increase of 2.99%, but Country Garden declined by 1.23%. Other notable movements included CSPC Pharmaceutical, which stumbled 1.74%, Galaxy Entertainment down 0.68%, and Henderson Land, which shed 0.95%. Meanwhile, Hong Kong & China Gas soared by 2.41%, Industrial and Commercial Bank of China, along with CLP Holdings, both advanced by 1.53%. JD.com tumbled by 2.09%, Lenovo slumped 1.43%, Li Ning slid 1.29%, and Meituan plunged by 2.29%. Conversely, New World Development advanced by 0.69%, Techtronic Industries plummeted by 4.03%, Xiaomi Corporation slid by 0.36%, WuXi Biologics sank by 1.20%, and China Resources Land and Hang Lung Properties remained unchanged.

The sentiment from Wall Street appears cautiously optimistic. Markets opened slightly higher on Monday, maintaining this level for much of the day before closing firmly in positive territory. The Dow Jones Industrial Average gained 50.66 points or 0.13% to finish at 39,169.52, the NASDAQ rallied 146.70 points or 0.83% to end at 17,879.30, and the S&P 500 increased by 14.61 points or 0.27%, closing at 5,475.09.

Wall Street's subdued performance may be attributed to anticipation of the Labor Department's monthly jobs report, due on Friday. This report, expected to indicate a slowdown in June's job growth, could influence interest rate projections. Traders might also be waiting for remarks from Fed Chair Jerome Powell on Tuesday, alongside the upcoming Independence Day holiday on Thursday.

In the U.S. economic landscape, the Institute for Supply Management reported a faster-than-expected contraction in manufacturing activity for June. Meanwhile, the Commerce Department noted a slight reduction in construction spending for May.

Oil prices surged on Monday due to expectations of higher demand, supply concerns, and OPEC's production cuts. West Texas Intermediate Crude oil futures increased by $1.84, roughly 2.2%, closing at $83.38 per barrel. Closer to home, Hong Kong will release data for May retail sales later today. In April, retail sales plummeted by 14.7% year-over-year.