Market Commentary and Intraday News

Hong Kong Stock Market May Extend Gains

297 days ago

(RTTNews) - The Hong Kong stock market on Thursday halted the three-day slide in which it had fallen almost 665 points or 3.6 percent. The Hang Seng Index settled just above the 18,890-point plateau, and now analysts are predicting additional support at the opening of trade on Friday.

The global forecast for the Asian markets is broadly positive as European Central Bank President Mario Draghi promised to do whatever is necessary to support the beleaguered eurozone. Upbeat economic data from the United States added to the positive sentiment, which was also helped by bargain hunters. The European and U.S. markets finished sharply higher and the Asian bourses are expected to follow that lead.

The Hang Seng finished barely higher on Thursday as gains from the property sector were offset by weakness from the casinos.

For the day, the index rose 15.46 points or 0.08 percent to finish at 18,892.79 after trading between 18,793.15 and 18,961.58 on volume of 43.41 billion Hong Kong dollars.

Among the actives, China Overseas Land jumped 2.9 percent, while Hong Kong Exchanges dipped 1.3 percent, Sands China dropped 4.9 percent, Galaxy Entertainment fell 2.8 percent, Wynn Macau gave away 3.0 percent and Cheung Kong Infrastructure plummeted 6.7 percent.

The lead from Wall Street is firmly upbeat as stocks moved sharply higher on Thursday, with traders reacting positively to comments by Draghi. Speaking at an investment conference in London, Draghi promised to do whatever is necessary to support the beleaguered eurozone.

"Within our mandate, the ECB is ready to do whatever it takes to preserve the euro - and believe me, it will be enough," Draghi said. His remarks generated optimism about the possibility of more action to ease the ongoing debt crisis at the next ECB monetary policy meeting next Thursday.

Relatively upbeat U.S. economic data also generated some buying interest, with the Labor Department reporting a much bigger than expected drop in weekly jobless claims. Initial jobless claims fell to 353,000 in the week ended July 21 from the previous week's revised figure of 388,000. Economists had expected 380,000, down from the 386,000 originally reported for the previous week.

A separate report from the Commerce Department showed a much bigger than expected increase in durable goods orders in June, although the increase was largely due to a jump in orders in the volatile transportation sector. Meanwhile, the National Association of Realtors reported an unexpected decrease in pending home sales in June.

Traders also digested the latest batch of earnings news, with oil giant Exxon Mobil advancing by 1.5 percent after reporting strong second quarter profit growth due in large part to one-time gains. 3M, Dow Chemical, and Hershey were among the other well-known companies that released their quarterly results.

After rallying at the open, the major averages remained in firmly positive territory throughout the session. The Dow jumped 211.88 points or 1.7 percent to 12,887.93, while the NASDAQ surged 39.01 points or 1.4 percent to end at 2,893.25 and the S&P 500 soared 22.13 points or 1.7 percent to 1,360.02.

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