if the market is concerned, it needs to observe the economic and real estate market trends in the fourth quarter.
2024-09-30
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(the author of this article is zhou hao, chief economist of guotai junan international)
in the past week, chinese assets have experienced the largest surge since 2008, with the hang seng index leading the way, directly hitting the 20,000-point mark. the trading volume of hong kong stocks also exceeded hk$400 billion on friday, setting a record. the series of stimulus measures introduced by the central bank last week greatly boosted market confidence. for a time, existing mortgage interest rates were lowered, benchmark interest rates were lowered, and the central bank provided innovative tools to support the stock market. measures were introduced last week. the market is also clamoring for a significant "turn" in china's economic policy. on sunday night, a series of measures to relax real estate were introduced, making the market full of expectations for the real estate market during the national day golden week. since hong kong stocks only have one day off during the national day golden week, the hang seng index and offshore rmb will become important indicators for observing market sentiment during the national day holiday.
it has to be said that this is not the first time that hong kong stocks have rebounded or even reversed before the end of the year. in the past few years, hong kong stocks have often performed well in the fourth quarter. but something different from the previous two years is that the hang seng index is currently in an upward trend, so the probability of a reversal has begun to increase. of course, whether the market reverses still requires the cooperation of many conditions. we can only say that from a technical point of view, the shape of the hang seng index is currently at its best moment in the past few years.
the importance of technical analysis is very important in financial markets. generally speaking, we can think that investors have enough information and therefore have corresponding expectations for the market. from this perspective, the final shape of the market indicates to a large extent the result of the market game. if a positive external force appears at this time, the market may accelerate the previous trend. for hong kong stocks, this effect has been very obvious in the past week. before the intensive introduction of policies last tuesday, the hang seng index had already reached a very obvious bottom and gradually increased. with the support of the policies, the hang seng index rose rapidly and broke through several key psychological points. at the same time, the hang seng index increased volume indicates that the possibility of the hang seng index reaching historical levels is gradually increasing.
of course, there are still many issues that the market is concerned about. the key factors remain the implementation of policies and actual feedback from the economy. to answer these questions, investors need patience, especially the need to observe the actual trends of china's economy and real estate market in the fourth quarter. but the question that may require more concern is that if the market remains excited, will the improvement in the economy be able to satisfy the growing appetite of investors?
so, we are back to a new prisoner's dilemma, which results in investors never being in harmony with the market. at this time, research and attention to fundamentals will become key, but without long-term tracking and analysis, when there are huge changes in sentiment, the view of fundamentals will most likely be biased. at this time, technical analysis may still be the best solution, because it may make it easier for investors to find more practical pricing anchors.
another noteworthy event last week was that shigeru ishiba is about to become japan's next prime minister. since japan plays an important role in the geopolitical landscape of the asia-pacific, the appointment of the new prime minister has also triggered market concerns about the future geopolitical landscape of the asia-pacific. focus on. from an economic perspective, due to shigeru ishiba's support for the bank of japan's efforts to tighten monetary policy, the dollar-yen exchange rate fell from 146.5 to 142.15 last friday, and the yen appreciated by nearly 3%. investors are also worried that if it falls below the previous low of 139.57, it may trigger a new round of arbitrage trading and be forced to liquidate positions. but what investors may need to worry more about is whether rmb assets will receive attention again, whether it will have a substitution effect on the japanese market, the star of the market in the past period.
of course, investors are also worried about the tax policies that shigeru ishiba may adopt after taking office, which further increases the possibility of short-term capital outflows from the japanese stock market. during the election process, shigeru ishiba expressed his intention to actively consider implementing this measure regarding the necessity of "taxation of financial income" such as stock sales gains. he said, "i really want to implement this measure because (japanese prime minister) mr. fumio kishida initially that’s what i said. i don’t know where the resistance comes from, but i always feel that this is something backwards.”
shigeru ishiba pointed out that taxation of financial income has been said. some people say that if this policy is implemented, wealth will flow overseas and wealthy people will leave japan. perhaps this is why this policy has been suppressed. however, whether japan will really face the problem of capital outflow needs further discussion.
(this article represents only the author’s personal views)
