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Interest Rate-sensitive U.S. Tech Giants Caused The Biggest Drag, H.K. Large Technology Stocks Fell

U.S. Stocks 

Fundamental Analysis: 

U.S. stocks closed lower on Monday, 27th June 2022 with few catalysts to drive a change in investor sentiment near the halfway point of the year, during which stocks have been weighed down by rising inflation worries and Federal Reserve tightening.

All three major stock indexes closed lower, after trading shakily earlier in the session.

Interest rate-sensitive tech giants such as Amazon, Microsoft and Alphabet caused the biggest drag.

Economic data were surprising, with the monthly rate of durable goods orders and the pending home sales index both better than expected in May, adding credibility to Fed Chairman Jerome Powell’s assertion that the economy is strong enough to withstand interest rate hikes to curb the impact of inflation, which is at a multi-decade high, and will not fall into recession.

There are still a few weeks to go before the second quarter earnings season, and 130 S&P 500 component companies have pre-reported earnings.

According to Lufthansa, 45 of them are positive and 77 are negative, resulting in a negative/positive ratio of 1.7, stronger than the first quarter but weaker than a year ago.

Technical Analysis: 

(Dow 30, 1-hour chart) 

Execution Insight: 

The Dow focuses on the 31661-line today. If the Dow runs steadily above the 31661-line, it will pay attention to the suppression strength of the 32083 and 32455 positions. If the Dow runs steadily below the 31661-line, it will pay attention to the support strength of the 31291 and 31000 positions.

Hong Kong Stocks 

Fundamental Analysis: 

Overnight, U.S. stocks closed lower, and Hong Kong stocks opened lower, with Hang Seng Index (HSI) down 0.38%, Hang Seng China Enterprises Index (HSCEI) down 0.46% and Hang Seng TECH Index (HSTECH) down 0.89%.

On the market, yesterday’s strong large technology stocks fell en masse, with, Inc. (9618.HK) down 2.56%, Tencent Holdings Limited (0700.HK) down 1.43%, Xiaomi Corporation (1810.HK), NetEase, Inc. (9999.HK) and Alibaba Group Holding Limited (9988.HK) all lower, Baidu, Inc. (9888.HK) slightly higher, NIO Inc. (9866.HK) down over 6%, GDS Holdings Limited (9698.HK) down over 4%, Bilibili Inc. (9626.HK) and XPeng Inc. (9868.HK) down over 2%.

Retail stocks led the decline, with recent active performance of sporting goods stocks, dairy stocks, new energy automotive stocks, biotechnology stocks, cell phone concept stocks fell in general.

On the other hand, oil stocks rose against the trend, three barrels of oil are strong, domestic housing stocks, airline stocks partly higher.

GOME Retail Holdings Limited (0493.HK) fell nearly 8%, with a proposed placement of 1.963 billion shares at a discount of more than 12%.

Clover Biopharmaceuticals, Ltd. (2197.HK) rose nearly 15% as the Covid-19 candidate vaccine as a homologous booster shot showed strong cross-neutralization of Omicron.

Technical Analysis: 

(HK50, 1-hour chart) 

Execution Insight: 

HK50 focuses on the 22127-line today. If HK50 can run stably above the 22127-line, then focus on the suppression strength of 22785 and 23294. If HK50 runs below the 22127-line, then pay attention to the support strength of 21450 and 20467.

FTSE China A50 Index 

Technical Analysis: 

(FTSE China A50, 1-hour chart) 

Execution Insight: 

FTSE China A50 focuses on the 14695-line today. If the A50 runs stably below the 14695-line, pay attention to the support strength of the two positions of 14352 and 13970. If the A50 runs above the 14695-line, it will open up further upward space. At that time, pay attention to the two positions of 14985 and 15184.

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