Hang Seng Index Stay Above 21,000

HK stock opend 123 points lower on Tuesday, and extended the loss to over 200 points, however it trimmed the loss near market close. The Hang Seng Index were flat and finished the day at 21,225 while H share index fell 10 points to 9,733. Market turnover was HK$59.0bn. Galaxy (0027) surged 6% as brokers estimated Jun gamabling income will be encouraging. GCL-Poly (3800) plunged 12.4% on share sale by China Investment Corporation, other solar plays were weak, Solargiga(0757) tumbled 5.4%. Cheung Kong (0001), CKH(1038), PAH(0006) and LKSFL acquired waste service provider in Netherlands, CKH edged up 1.2% on positive market comments.

US stock market Rebounded

Investors speculates that the Fed announcement and Bernanke press release after FOMC meeting will ease investors concerns toward scale down of asset purchase plans, US stock continued to rebound on Tuesday. The Dow and the Nasdaq rose 138 points (to 15,318) and 30 points (to 3,482). On the other hand, despite mixed performance of USD, gold price dropped US$16 to US$1,367 per ounce.

The Hang Seng Index is expected to trade at 21,000 to 21,400 today

Hujin’s stake increase mainland banking sector, it will help to stabilize market sentiment. The Hang Seng Index technical trend also reversed some of the early weakness after staying above 21,000. Initial resistance will be seen at 250 Day SMA(21,545).

Technical Analysis

Hang Seng Index closed with hammer on Tuesday. Technically, market closed above 21,000, coupled with the MACD bearish gap narrowed, showing that momentum turning stable. The first resistance would be 250DMA (21,545), while next resistance would be seen at 22,000. For support, the first support would be year’s low of 20,653 while next support would be seen at 20,000.