The Dow fell by 1.1% last week, while the S&P 500 declined by nearly 0.6%, breaking a two-week winning streak. Major stock indices came off from a losing week as investors grew worried that the Fed’s potential move to pull back monetary stimulus could slow down the economic recovery that is already challenged by the spread of the Delta COVID-19 variant.
Traders are eagerly awaiting the Jackson Hole symposium for clues on the Fed’s timeline for scaling back its bond-buying program. The event takes place virtually on Thursday and Friday, 26 August and 27 August 2021.
Under the double blow of slowing economic growth caused by the recovery of the pandemic and the Fed’s reduction in bond purchases, the US stocks rebounded. However, the latter is still rumored and there is no timeline.
Today, we pay attention to the 35110-line. Above this level, we should follow and take advantage of the bullish trend. On the top, pay attention to the suppression of the 35346-line. Once the Dow falls below 35110, there is a possibility of it opening up further downward revision, then pay attention to the support strength of the 34990 position.
Hong Kong Stocks
The Hang Seng Index expanded to 2.12%, returning to 25,000 points, and the China blue-chip stocks rose across the board. Among them, Ali Health rose more than 7%, Hong Kong Exchanges and Clearing (HKEX) surged by almost 6%, Xiaomi rose by 6%, Country Garden Service rose by more than 5%, BYD rose by 5%, and Tencent climbed to 4%.
The China Securities Regulatory Commission (CSRC) held a systemic mid-year supervision work meeting last week and said it would create conditions to promote Sino-US audit supervision cooperation and strengthen market communication, stabilizing policy expectations and institutional environment.
HKEX announced the launch of the first A-shares futures on Friday, 20 August 2021. The new futures contract will provide international investors with a tool to effectively hedge their risks of investing in China’s A-shares market, reflecting that more and more international investors have entered the mainland Chinese market through the Shanghai-Hong Kong/Shenzhen-Hong Kong Stock Connect.
On HK50, we focus on the 24469-line today as it remains its bullish trend. Meanwhile, pay attention to the suppression strength of the 25816-line. Once the strength falls below the 24469-line, attention should be diverted to the support of 24029-line.
FTSE China A50 Index
On A50, continue to pay attention to the 14469-line today. If the A50 runs above the 14469-line, the idea is to maintain the bullish trend. Then, pay attention to the suppression strength of the 15184 position. If the A50 falls below the 14469-line, direct your focus to the support of the 13983-line.
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