Hong Kong: HANG SENG INDEX (.HSI) August retail sales hammered by summer of rage

Hong Kong: HANG SENG INDEX (.HSI) August retail sales hammered by summer of rage

Hong Kong: HANG SENG INDEX (.HSI) August retail sales hammered by summer of rage

Strife-torn Hong Kong has suffered a record slump in retail sales, data showed Wednesday, as the city reels from four months of increasingly violent pro-democracy protests.

The international finance hub is a major international tourist destination and especially popular with mainland Chinese shoppers hoping to snap up bargains in a city with no sales tax.

But this summer’s protests, sparked by rising public anger towards Beijing’s rule, has battered the economy which was already struggling with the US-China trade war fallout.

New figures released Wednesday showed retail sales declined by a record 23 percent year on year in August, compounding a 11.5 percent slump the month before.

Both police and protesters have only escalated their violence since then so there is little chance September’s figures will fair any better.

Tuesday witnessed the worst clashes of the summer as China celebrated 70 years of Communist Party rule with a massive military parade in Beijing.

The spiralling clashes underscored seething public anger against Beijing’s rule and shifted the spotlight from China’s carefully choreographed birthday party.

Usually the first week of October is a bumper time for retailers.

Huge numbers of Chinese mainland tourists visit during the so-called Golden Week holiday.

But tourist arrivals from the mainland have tumbled as Beijing takes a hardline with protesters and police fight near weekly battles against demonstrators.

On-year tourist arrivals fell 40 percent in the last month, led by a collapse in visitors from the mainland — by far the largest group, with hotel occupancy rates down around half.

Luxury goods are thought to have been hit particularly hard.

Many of the clashes have taken place in the districts of Tsim Sha Tsui and Causeway Bay, both areas of the city that are packed with luxury malls and retailers.

Multiple shops in Causeway Bay told AFP last month their takings were down by as much as 30 percent over the summer.

The city’s economy likely entered a technical recession in the third quarter, Financial Secretary Paul Chan said in September.

But the city’s pro-Beijing leaders have shown little appetite or ability to meet protester demands, or to find a political solution.

Technical Indicators

Overall, the bias in prices is: Downwards.

By the way, prices are vulnerable to a correction towards 26,605.16.

The projected upper bound is: 26,855.22.

The projected lower bound is: 25,133.21.

The projected closing price is: 25,994.21.

Candlesticks

A white body occurred (because prices closed higher than they opened).
During the past 10 bars, there have been 2 white candles and 8 black candles for a net of 6 black candles. During the past 50 bars, there have been 18 white candles and 32 black candles for a net of 14 black candles.

Momentum Indicators

Momentum is a general term used to describe the speed at which prices move over a given time period. Generally, changes in momentum tend to lead to changes in prices. This expert shows the current values of four popular momentum indicators.

Stochastic Oscillator

One method of interpreting the Stochastic Oscillator is looking for overbought areas (above 80) and oversold areas (below 20). The Stochastic Oscillator is 41.2310. This is not an overbought or oversold reading. The last signal was a buy 1 period(s) ago.

Relative Strength Index (RSI)

The RSI shows overbought (above 70) and oversold (below 30) areas. The current value of the RSI is 42.36. This is not a topping or bottoming area. A buy or sell signal is generated when the RSI moves out of an overbought/oversold area. The last signal was a buy 31 period(s) ago.

Commodity Channel Index (CCI)

The CCI shows overbought (above 100) and oversold (below -100) areas. The current value of the CCI is -85. This is not a topping or bottoming area. The last signal was a buy 1 period(s) ago.

MACD

The Moving Average Convergence/Divergence indicator (MACD) gives signals when it crosses its 9 period signal line. The last signal was a sell 6 period(s) ago.

Rex Takasugi – TD Profile

HANG SENG INDEX closed down -49.580 at 26,042.689. Volume was 28% below average (neutral) and Bollinger Bands were 28% narrower than normal.

Open     High      Low     Close     Volume___
25,901.47126,092.61925,778.22126,042.6891,202,153,856
Technical Outlook 
Short Term: Neutral
Intermediate Term: Bullish
Long Term: Bearish
Moving Averages: 10-period     50-period     200-period
Close: 26,223.92 26,465.31 27,651.88
Volatility: 11 21 19
Volume: 1,504,409,472 1,721,091,968 1,785,882,752

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 5.8% below its 200-period moving average and is in an upward trend. Volatility is high 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 16 periods.

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