INVESTMENT DAILY

The Hang Seng Index is expected to trade at 24,000 to 24,500today.

    Hang Seng Index showcased a first-low-last-high scenario on Tuesday. It had fallen211 points, yet it benefitted from mainland stocks rebound to rise nearly 600 pointsonce. It then narrowed the rebound to close at 24,503, increasing 151 points. HSCEIclosed at 11,173, decreasing 57 points. Turnover was $115.3 billion. Blue chipstocks generally surge, and large capitalization stocks such as HSBC(0005), ChinaMobile(0941)and Tencent(0700)rose to lead the market rise. Petrochina(0857)and CNOOC(0883)jumped over 2% respectively as well.

    Thanks to the sharp rebound of major oil stocks like Exxon and Chevron, togetherwith more stabilized performance of China A share market on Tuesday, US stockmarket rebounded sharply on Tuesday. Besides, expectation for a September interesthike has faded given the recent weakness of global market. The Dow and theNasdaq closed 190 points (to 17,630) and 49 points (to 5,089) higher respectively.

    Besides, funds stop flowing into bond market, with 10 years US treasury yield rose 2basis point to 2.26%.

    US stock market sharply rebound, it might help the local market to open higher today,but China A share still not good, it hurts sentiment on HK listed China plays.

    Besides, investors will also eye on FOMC meeting result tonight.

    Technical Analysis.

    Hang Seng Index once climbed to 24,947 points on Tuesday, yet it then massivelyfell back and failed to surpass 250DMA(24,962 points)again. Adding that MACDbullish gap almost vanishes, it shows that the market still doesn’t become stable.

    From the day chart, the bottom of Bollinger Band locates around 23,920 points,hence Hang Seng index first support would be 23,920, while next support would be23,400. For resistance, 250DMA(24,962)would become the first resistance, whilenext resistance would be seen at 25,500.