Hong Kong: HANG SENG INDEX (.HSI) mixed after weak China data
Asian markets were mixed on Tuesday following the release of weak producer price data from China.
Figures from China’s National Bureau of Statistics showed the largest contraction in factory gate prices in three years, with prices dropping by 0.8% compared to a year earlier in August, and falling for the second successive month.
Analysts from Pantheon Macroeconomics said: “Electrical equipment and machinery and communications, alongside autos and paper-making accounted for most of the drag. Oil remains continues to subtract from the headline, both directly, and through its impact on chemicals production.”
Meanwhile, both the Federal Reserve and the ECB are expected to announce monetary stimulus moves, with markets remaining subdued as the nature of these packages remains unclear.
Japan’s Nikkei 225 ended the session 0.35% higher at 21,392.10, with Nissan driving the index higher after the car manufacturer’s chief executive, Hiroto Saikawa, quit following pressure involving an executive pay scandal.
SoftBank shares increased by 1.77% as it urged its investee company WeWork not to pursue an IPO, amid concerns about its valuation.
Meanwhile, the Japanese yen was down 0.07% against the US dollar at JPY107.32.
On the Chinese mainland, the Shanghai Composite edged down 0.12% to 3,021.20 and the tech-heavy Shenzhen Composite was 0.11% lower at 1,687.31 on the back of the weak Chinese data.
China National Software & Service Co, Guangdong Ellington Electronics Technology Co and Hefei Metalforming Intelligent Manufacturing Co led the indices lower as they each dropped by more than 5%.
Hong Kong’s Hang Seng Index remained flat at 26,683.68 as city chief executive Carrie Lam warned demonstrators that escalating violence would not solve problems in the administrative region.
The South Korean Kospi climbed by 0.62% to 2,032.08, rising for the fifth consecutive session as construction firms with exposure to North Korea surged after Pyongyang said it would be willing to restart talks with Washington.
Index bellwether Samsung Electronics was up by 0.26% but heavyweight chipmaker SK Hynix dropped by 1.42%.
Brent Crude was 0.27% firmer at $62.76 a barrel, while West Texas Intermediate rose by 0.36% to $58.06.
Down under, the Australian S&P/ASX 200 fell by 0.51% to 6,614.06 as healthcare stocks fell, with both CSL and Sonic Health trading ex-dividend.
New Zealand’s S&P/NZX 50 dropped by 0.54% to 11,142.58 as power companies lost their lustre, having recently reached record levels due to reliable dividend payments.
Contact Energy, Genesis Energy, Meridian Energy and Mercury NZ were all between 1% and 2% lower.
Finally, the Australian dollar inched 0.05% lower against the US dollar to A$1.46, while New Zealand’s dollar dipped by 0.06% against the greenback to NZ$1.56.
Overall, the bias in prices is: Sideways.
The projected upper bound is: 27,486.79.
The projected lower bound is: 25,792.90.
The projected closing price is: 26,639.84.
A black body occurred (because prices closed lower than they opened).
During the past 10 bars, there have been 3 white candles and 7 black candles for a net of 4 black candles. During the past 50 bars, there have been 23 white candles and 27 black candles for a net of 4 black candles.
Three black candles occurred in the last three days. Although these candles were not big enough to create three black crows, the steady downward pattern is bearish.
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.
One method of interpreting the Stochastic Oscillator is looking for overbought areas (above 80) and oversold areas (below 20). The Stochastic Oscillator is 89.1107. This is an overbought reading. However, a signal is not generated until the Oscillator crosses below 80 The last signal was a sell 11 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 56.50. 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 16 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 113.This is an overbought reading. However, a signal isn’t generated until the indicator crosses below 100. The last signal was a buy 19 period(s) ago.
The Moving Average Convergence/Divergence indicator (MACD) gives signals when it crosses its 9 period signal line. The last signal was a buy 15 period(s) ago.
Rex Takasugi – TD Profile
HANG SENG INDEX closed up 2.279 at 26,683.680. Volume was 3% below average (neutral) and Bollinger Bands were 25% narrower than normal.
Open High Low Close Volume___
Short Term: Overbought
Intermediate Term: Bullish
Long Term: Bearish
Moving Averages: 10-period 50-period 200-period
Close: 26,129.27 27,066.53 27,643.52
Volatility: 23 20 20
Volume: 1,772,860,928 1,584,889,728 1,785,338,112
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.
HANG SENG INDEX is currently 3.5% 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 moderate flows of volume into .HSI (mildly bullish). Our trend forecasting oscillators are currently bullish on .HSI and have had this outlook for the last 1 periods.