HSI inched down 5 points, market lack of fresh clues
Following the retreat in the regional markets, Hang Seng Index opened low on Tuesday and remained range traded, it finished at 22,527 points by dropping 5 points. Hang Seng H share index also down 15 points to 12,443. Market turnover shrank to HK$51,926mn reflecting lack of fresh clues. China mobile (0941.HK) announced in-line June operating data, its share price rose 0.4% to HK$106.90. Esprit (0330.HK) slid 2.3% to HK$82.00 on senior management restructure. BOC (3988.HK) climbed 0.58% to HK$3.47 despite the share placement news. Rise in oil price dragged down the performance of aviation counters with Air China (0753.HK) slipping 3.4% to HK$4.26.

US Market gain on oil drop
US market opened lower on the fourth larger US bank, Wachovia¡¦s quarterly loss. However, a plunge in oil prices soothed the U.S. stock market. The Dow Jones up 135 points to 11,602 while Nasdaq Composite Index edged up 24 points to 2,303.

The HSI is expected to trade between 22,400-22,800
Hong Kong stocks should rally on oil drop and strong performance of regional markets. However, the rebound should be limited given lack of fund support. Commodity should drop on strong USD. Airlines and shipping counters should rebound on soften oil price.

Technical Analysis
Hang Seng Index stand above the 20 days moving average (21,904) with 10DMA (21,889) is in uptrend. If 10DMA broke the 20DMA, would see golden cross. Initial resistance saw at 22,800 points, while next resistance will be 50DMA (23,301). Initial support is 22,200 while major support is 10DMA (21,889).