Hang Seng rally runs out of gas as casinos and HSBC share price lead
The Hang Seng index was barely moved today as investors followed the developments in Hong Kong closely. That is after the city’s legislature passed the controversial anthem bill and a day after more companies expressed their support for the national security law passed last week.
HSBC supports the national security law
HSBC, the giant banking group became the latest big company to support the controversial security law that China passed last week. In a statement, the company said that the bill would help the city deal with the increasing cases of protests in the city. The bank, which is the biggest bank in the city, said that it had endorsed an earlier statement by the banking association that had made.
HSBC share price in Hong Kong rose by more than 1.44%.
Other companies that have supported the bill include Swire Pacific, which owns Cathay Pacific, and CK Hutchison, the giant conglomerate.
It makes sense for these companies to support these bills. For one, they suffered significantly last year when the city was turned upside down by protestors. Also, they risk the ire of Beijing if they take the side of the pro-democracy activists.
Earlier on, Carrie Lam, the city’s chief executive said that Beijing had listed to the “voice of Hong Kong people.” She said this after she returned from China.
Best and worst performing stocks in Hang Seng
Most stocks in Hong Kong were in the red today. The best performing stock in the Hang Seng was Sands China, which rose by more than 4.22%. Galaxy Entertainment, another casino operator, gained by more than 1%. Other top gainers in the index were WH Group, Want Want China, and Sunny Optical. Also, insurance firms like Ping An, and AIA Group were in the green also.
On the other hand, the worst-performers in the Hang Seng index were CK Infrastructure, China Shenhua Energy, China Overseas, PetroChina, and Wharf Real Estate among others.
Yesterday, the Hang Seng index moved above the 50-day exponential moving averages. Today, it is trading at $24,310, which is slightly below the day’s high of $24,619. On the daily chart, the price is slightly above the 38.2% Fibonacci retracement level. It is also below the 100-day EMA. Therefore, the pair will remain in an upward trend provided that bulls can move above the 100-day EMA at $24,880.
On the flip side, a move below the 50-day EMA and the 38.2% retracement at around $24,200 will invalidate this prediction.