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June 22, 2019: Hong Kong Has Turned Into a Good Stock Market

Hang Seng

The Hang Seng Index is a free float adjusted market capitalization weighted stock market index in Hong Kong. It is used to record and monitor daily changes of the largest companies of the Hong Kong stock market. It is the main indicator of the overall market performance in Hong Kong. Hang Seng Index outperformed world’s major indexes this week. Central banks have helped supercharge a rebound in Hong Kong stocks. The Hang Seng Index increased 5% this week. That’s its best rise since early November. The Hang Seng Enterprises Index was a close second, adding 4.8%. The Hong Kong dollar strengthened towards the midpoint of its trading band with the greenback, a level it hasn’t breached since September.

Hong Kong

Next week’s Group of 20 summit could decide the recovery of Hong Kong stocks. The city is one of Asia’s largest equity markets. The city performance helps measure global liquidity expectations and macroeconomic concerns. The benchmark Shanghai Composite Index rose 4.2% this week. The ChiNext Index continued to recover with a 4.8% gain. This was helped by proposals to make backdoor listings easier. It is difficult to be too optimistic – anything could happen. Investors are thinking about yuan strength. The yuan’s 2-week implied volatility increased the most this week since trade tensions increased last month.