Market Commentary and Intraday News

Additional Support Called For Hong Kong Stock Market

217 days ago

(RTTNews) - The Hong Kong stock market has finished higher now in four straight trading days, climbing almost 300 points or 1.5 percent en route to another fresh five-month closing high. The Hang Seng Index ended just above the 21,205-point plateau, and now traders are looking for another firm start for the market when it kicks off trade on Wednesday.

The global forecast for the Asian markets is broadly upbeat thanks to solid earnings news and optimism that Spain may finally apply for a bailout. The markets should respond favorably to news that financial giant Goldman Sachs (GS) beat forecasts, as did Coca-Cola (KO) and Johnson & Johnson (JNJ). In addition, reports are circulating that the Spanish government is prepared to officially request a bailout, providing a measure of clarity for the region. The European and U.S. markets were sharply higher on Tuesday and the Asian bourses are expected to open in similar fashion.

The Hang Seng finished modestly higher on Tuesday as gains from the resource stocks were offset by weakness from the mainland financials and telecoms.

For the day, the index climbed 58.82 points or 0.28 percent to finish at 21,207.07 after trading between 21,120.17 and 21,257.09 on turnover of 48.62 billion Hong Kong dollars.

Among the gainers, China Resources Land surged 5.13 percent, while China Shenhua Energy spiked 0.64 percent, Cheung Kong jumped 1.14 percent, HSBC climbed 1.21 percent, Hutchison Whampoa collected 0.86 percent, CNOOC added 1.01 percent and China Life Insurance was up 0.65 percent.

Moving lower, Henderson Land shed 0.45 percent, while China Petroleum and Chemical Corp (Sinopec) lost 0.89 percent, China Construction Bank plummeted 1.90 percent, Bank of Communications fell 0.52 percent, Bank of China dipped 0.32 percent and China Mobile retreated 0.48 percent.

The lead from Wall Street remains positive as stocks were higher on Tuesday with traders reacting positively to the latest batch of earnings news. The markets extended Monday's upward move, continuing to recover from last week's weakness.

The rally followed quarterly results from some big-name companies, including financial giant Goldman Sachs (GS), which reported adjusted third quarter earnings of $2.85 per share compared to a year-ago loss of $0.84 per share, while analysts had expected earnings of $2.12 per share.

Beverage giant Coca-Cola (KO) also saw Q3 earnings that beat estimates but missed on revenues. Johnson & Johnson (JNJ) reported third quarter earnings and sales that exceeded estimates and also raised its full-year guidance.

Traders also reacted to news that health insurer UnitedHealth (UNH) raised its full-year guidance and that online retailer Amazon (AMZN) is hiring for more than 50,000 seasonal positions this holiday season.

Shares of Citigroup (C) were also in focus after the financial giant announced that Vikram Pandit has stepped down as the company's Chief Executive Officer and as a member of the Board. Citigroup's board unanimously elected Michael Corbat as CEO and a director of the Board. Corbat previously served as Citigroup's CEO of Europe, Middle East and Africa.

Separate reports showing a rebound by industrial production and a continued increase in homebuilder confidence also helped to push stocks higher. The Labor Department also released a report showing that consumer prices rose by slightly more than expected in September due to a jump in energy prices.

The major U.S. averages were firmly higher again on Tuesday as the Dow jumped 127.55 points or 1 percent to finish at 13,551.78, while the NASDAQ surged 36.99 points or 1.2 percent to end at 3,101.17 and the S&P 500 advanced 14.79 points or 1 percent to end at 1,454.92.

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