Hong Kong Economic Update

Hong Kong Economic Update

HSI

HANG SENG INDEX closed down -48.420 at 23,728.070. Volume was 24% above average (neutral) and Bollinger Bands were 10% narrower than normal.

Open High Low Close Volume___
24,044.48024,080.86923,694.33023,728.0702,111,361,280

Technical Outlook
Short Term: Oversold
Intermediate Term: Bullish
Long Term: Bullish

Moving Averages: 10-period 50-period 200-period
Close: 23,959.63 23,032.70 22,401.93
Volatility: 10 12 17
Volume: 1,909,525,248 1,742,926,976 1,735,026,304

Short-term traders should pay closer attention to buy/sell arrows while intermediate/long-term traders should place greater emphasis on the Bullish or Bearish trend reflected in the lower ribbon.

Summary

HANG SENG INDEX is currently 5.9% above its 200-period moving average and is in an upward trend. Volatility is relatively normal as compared to the average volatility over the last 10 periods. Our volume indicators reflect volume flowing into and out of .HSI at a relatively equal pace (neutral). Our trend forecasting oscillators are currently bullish on .HSI and have had this outlook for the last 36 periods. our momentum oscillator has set a new 14-period low while the security price has not. This is a bearish divergence.

Hong Kong is home to the largest number of super rich in Asia with 4,080 ultra high net worth individuals who own 3 homes on average, compared with 4 in Taiwan, and 3 in Singapore, a study by a leading realtor found.

There were 51 billionaires in Hong Kong last year, representing an increase of 48 in a year.

On a global scale, Hong Kong, where luruxy real estate is the second priciest in the world, ranks third, after New York City and London for the number of super rich.

In the decade from 2006 to 2016, the super rich in Asia soared by 25,260 to 46,080, the report calculated. In North America, by comparison, the super wealthy increased by 17,290 to 73,100. And in Europe, their numbers increased by 7,040 to 49,650.

Hong Kong Dollar

Hong Kong Dollar closed down -0.000 at 7.763. Volume was 33% below average (neutral) and Bollinger Bands were 17% narrower than normal.

Open High Low Close Volume___
7.763 7.764 7.762 7.763 4,807

Technical Outlook
Short Term: Overbought
Intermediate Term: Bullish
Long Term: Bullish

Moving Averages: 10-period 50-period 200-period
Close: 7.76 7.76 7.76
Volatility: 0 0 0
Volume: 5,344 6,587 6,481

Short-term traders should pay closer attention to buy/sell arrows while intermediate/long-term traders should place greater emphasis on the Bullish or Bearish trend reflected in the lower ribbon.

Summary

FOREX HKD= is currently 0.1% above its 200-period moving average and is in an upward trend. Volatility is relatively normal as compared to the average volatility over the last 10 periods. Our volume indicators reflect volume flowing into and out of HKD= at a relatively equal pace (neutral). Our trend forecasting oscillators are currently bullish on HKD= and have had this outlook for the last 20 periods.

Hong Kong’s retail sales continued fall in January to an estimated HK$43.1 billion, representing a drop of 0.9 percent on year.

Sales of electrical goods and photographic equipment were among the worst hit last month, the Census and Statistics Department said. Electrical goods and photographic equipment fell by 24.4 percent, while miscellaneous consumer durables sales dropped by 17.8 percent.

Sales of jewelry, watches and clocks, and valuable gifts dropped by 3.9 percent in January.

Retail sales fell in December by 2.9 percent compared with a year earlier.

The Census and Statistics Department said retail sales are more volatile in the first two months of a year due to the timing of the Lunar New Year, when consumer spending normally attains a seasonal high. As the Lunar New Year fell on January 28 this year but on February 8 last year, the year-on-year comparison of the figures for January 2017 with those for January 2016 might have been affected by this factor to a certain extent.

Sales of apparel were down by 5.2 percent and motor vehicles and parts dropped by 9 percent. Furniture and fixtures sales fell by 9.4 percent. Books, newspapers, stationery and gifts sales declined by 0.6 percent.

Sales of commodities in supermarkets increased by 5.4 percent in January over a year earlier. Sales of commodities in department stores increased by 2.8 percent.

The biggest growth was in sales of food, alcoholic drinks and tobacco (up by 9.9 percent) and consumer goods (up by 12.1 percent).

In the three months ending January, retail sales decreased by 3.3 percent, compared with the previous three-month period.

For 2016 as a whole, the value of total retail sales was provisionally estimated at HK$436.6 billion, representing a drop of 8.1 percent compared with 2015.

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Shayne Heffernan Funds Manager at HEFFX holds a Ph.D. in Economics and brings with him over 25 years of trading experience in Asia and hands on experience in Venture Capital, he has been involved in several start ups that have seen market capitalization over $500m and 1 that reach a peak market cap of $15b. He has managed and overseen start ups in Mining, Shipping, Technology and Financial Services.

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