U.S. stocks rallied for a second day on Thursday, 28th July 2022, with all three major stock indexes up more than 1%, as data showed the economy shrank for a second straight quarter, sparking speculation among investors that the Federal Reserve may not need to raise interest rates as aggressively as some had feared.
After the data was released, the indicator 10-year U.S. bond yield retreated, and utilities and real estate stocks. The two sectors that tend to rise when U.S. bond yields fall, were the best performers among the major S&P 500 sectors.
In addition, forecasts for second-quarter earnings growth rose this week as more S&P 500 component companies reported results and beat analysts’ expectations.
Ford shares jumped 6.1% after reporting better-than-expected quarterly net income.
After the bell, Amazon jumped more than 12% after the online retailer reported quarterly sales that beat Wall Street expectations. Amazon was up 1.1% in regular trading hours.
Earlier in the day, the U.S. Commerce Department said the U.S. economy unexpectedly contracted in the second quarter, the second consecutive quarterly decline in the government’s reported gross domestic product (GDP).
This increases the likelihood that the economy is on the brink of recession, which some investors say could prevent the Federal Reserve from continuing to aggressively raise interest rates as it battles high inflation.
The Nasdaq recorded its biggest two-day percentage gain since 27th May 2022. Stocks surged in the previous session as the magnitude of the Fed’s rate hike and remarks from Chairman Jerome Powell eased concerns about the pace of rate hikes.
(Dow 30, 1-hour chart)
The Dow focuses on the 32083-line today. If the Dow runs steadily above the 32083-line, it will pay attention to the suppression strength of the two positions of 32455 and 32781. If the Dow runs steadily below the 32083-line, it will pay attention to the support strength of the two positions of 31661 and 31291.
Hong Kong Stocks
U.S. stocks closed higher overnight as investors bet the Federal Reserve will slow the pace of interest rate hikes.
Hong Kong stocks opened higher, with Hang Seng Index (HSI) up 0.12%, Hang Seng China Enterprises Index (HSCEI) up 0.19%, and Hang Seng TECH Index (HSTECH) up 0.2%.
On the market, most of the large technology stocks rose, JD.com, Inc. (9618.HK), Xiaomi Corporation (1810.HK) rose more than 1%, Meituan (3690.HK), Baidu, Inc. (9888.HK) rose slightly, Alibaba Group Holding Limited (9988.HK), and NetEase, Inc. (9999.HK) lower.
Yesterday’s leading education stocks rose again, the New Oriental Education & Technology Group Inc. (9901.HK) jumped more than 11%.
Gas stocks were higher, while biotechnology stocks, insurance stocks, sporting goods stocks, lithium battery stocks part of the rise.
On the other hand, beer stocks Budweiser Brewing Company APAC Limited (1876.HK) opened 3.59% lower after the results, power stocks, shipping stocks, e-cigarette concept stocks fell in general.
(HK50, 1-hour chart)
HK50 focuses on the 21450-line today. If HK50 can run stably above the 21450-line, then pay attention to the suppression strength of 22127 and 22785. If HK50 runs below the 21450-line, then pay attention to the support strength of 20467 and 19517.
FTSE China A50 Index
(FTSE China A50, 1-hour chart)
FTSE China A50 focuses on the 13887-line today. If the A50 runs stably below the 13887-line, pay attention to the support strength of the two positions of 13544 and 13157. If the A50 runs above the 13887-line, it will open up further upward space. At that time, pay attention to the two positions of 14371 and 14695.
Trading in financial instruments involves high risks due to the fluctuation in the value and prices of the underlying financial instruments. Due to the adverse and unpredictable market movements, large losses exceeding the investor’s initial investment could incur within a short period of time. The past performance of a financial instrument is not an indication of its future performance. Investments in certain services should be made on margin or leverage, where relatively small movements in trading prices may have a disproportionately large impact on the client’s investment and client should therefore be prepared to suffer significant losses when using such trading facilities.
Please make sure you read and fully understand the trading risks of the respective financial instrument before engaging in any transaction with Doo Prime’s trading platforms. You should seek independent professional advice if you do not understand the any of the risks disclosed by us herein or any risk associated with the trade and investment of financial instruments. Please refer to Doo Prime’s Client Agreement and Risk Disclosure Statement to find out more.
This information is addressed to the general public solely for information purposes and should not be taken as investment advice, recommendation, offer, or solicitation to buy or sell any financial instrument. The information displayed herein has been prepared without any reference or consideration to any particular recipient’s investment objectives or financial situation. Any references to the past performance of a financial instrument, index, or a packaged investment product shall not be taken as a reliable indicator of its future performance. Doo Prime and its holding company, affiliates, subsidiaries, associated companies, partners and their respective employees, as well as managers, make no representation or warranties to the information displayed and Doo Prime and its holding company, affiliates, subsidiaries, associated companies, partners and their respective employees, as well as managers, shall not be liable for any direct, indirect, special or consequential loss or damages incurred a result of any inaccuracies or incompleteness of the information provided. Doo Prime and its holding company, affiliates, subsidiaries, associated companies, partners and their respective employees, as well as managers, shall not be liable for any direct, indirect, special or consequential loss or damages incurred as a result of any direct or indirect trading risks, profit, or loss arising from any individual’s or client’s investment.