Asia Session: Hong Kong Rallies On Concession Rumours

Rumours and intrigue are sweeping Hong Kong this afternoon, with MNI reporting that the local press is suggesting that the Hong Kong Government will announce another major concession to protestors at 16:00 HKT (0800 GMT).

China and the Hong Kong SAR

The Hang Seng has jumped 1.53% in anticipation even as mainland China markets eased today, as Chinese authorities have allegedly instructed banks to cap lending to property developers and mortgage borrowers; ensuring that any additional stimulus funds do not find their way into those sectors. Additionally, an easing of restrictions on foreign investment funds access to mainland bond markets was also met with an underwhelming response. Existing quotas being already heavily underutilised. The Shanghai Composite is lower by 0.41% and the CSI 300 by 0.58%.

Rest of Asia

The story was different in other parts of Asia with both the South Korean Kospi and the Japan Nikkei 225 higher by 0.90% and 0.85% respectively, supported by an expected easing of trade tensions and an ECB rate cut tomorrow.

Trade sensitive Singapore continues to benefit from the improved risk environment, with the Straits Times Index climbing 1.10%. Today’s move higher was also buoyed by government announcements to improve homeownership access to state housing.

Malaysia’s Industrial Production slumped to 1.20% led by a fall in oil and condensate products even as electronic manufacturing rose. It erased any gains in the KLCI which is flat on the day. The Malaysian Ringgit suffered as USD/MYR rose from 4.1700 to 4.1780.

Gold

Gold finally managed a rally today after four days of constant selling, rising 0.47% to $1493.00 an ounce. Gold will need to recapture the $1500.00 level to turn the recent bearish sentiment with longer-term technical resistance at $1530.00. Crucial technical support is at the $1480.00 area with another wave of stop-loss selling possible should it give way.

This article is for general information purposes only. It is not investment advice or a solution to buy or sell securities. Opinions are the authors; not necessarily that of OANDA Corporation or any of its affiliates, subsidiaries, officers or directors. Leveraged trading is high risk and not suitable for all. You could lose all of your deposited funds.

Jeffrey Halley

Jeffrey Halley

Senior Currency Analyst
Based in Singapore, Jeffrey has over 25 years experience in the financial markets, having traded currencies, options, precious metals and futures. Jeffrey started his career at Barclays Bank in New Zealand. However he has spent most of it in London and Asia.Jeffrey focuses on the Asia time zone across asset classes. A regular commentator on business news TV and Radio, he is originally from New Zealand and holds an MBA from Cass Business School, London.
Jeffrey Halley

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