Disc Room Incoming Materials | Hong Kong Stocks Face Headwinds in Rebound, Set to Fill Rising Gap Below

The US-Iran conflict is not over, and international oil prices are rising again. US stocks had mixed performance on Wednesday. The Dow opened down 15 points, then extended losses to as much as 520 points, with a low of 47,185. It closed down 289 points or 0.61%, at 47,417. The S&P 500 fell 25 points or 0.08%, to 6,775. The Nasdaq slightly rebounded by 6 points or 0.08%, to 22,716. The International Energy Agency (IEA) announced that member countries agreed to release a record 400 million barrels of emergency oil reserves to respond to the Iran conflict. However, oil prices continued to rise, with New York crude rebounding up to 6.64%, reaching a high of $88.99 per barrel, and closing at $87.25, up 4.55%. Brent crude oil once surged 6.1%, hitting $93.15, and closed at $91.98, up 4.76%. This morning, New York crude oil rose again, returning above $90, dragging down Asia-Pacific stock markets.

Last night, the US February Consumer Price Index (CPI) remained at a year-over-year increase of 2.4%, in line with expectations. However, if oil prices stay high due to ongoing conflict, inflation could rise again later. The Federal Reserve is unlikely to cut interest rates in the first half of the year. As long as the Iran conflict continues and oil prices stay elevated, global stock markets will remain volatile.

Looking at last night’s US stocks, although they recovered during the session after a weak open, futures in Asia this morning declined again. Performance is currently moderate, with holdings in stocks remaining within a range, showing no major breakthroughs. It seems conservative strategies are preferable for now—holding current portfolios without adding or reducing positions, and considering buying quality stocks if deeper corrections occur. The key support level for NQ tonight is 24,800, with initial support at 24,700, then 24,600, and a critical support at 24,500. Resistance above remains at 25,000, with next resistance at 25,150-25,200, and a larger resistance at 25,400. So far this month, NQ has stayed within the 24,000 to 25,400 range.

As for Hong Kong stocks, yesterday’s performance was mixed. The Hang Seng Index opened high but then declined. It rose by 189 points early on, reaching 26,149 at the high, but in the afternoon, it fell sharply, losing up to 140 points, with a low of 25,819. It closed down 61 points at 25,898, with a turnover of only HKD 254.4 billion. Although tech stocks rebounded early, many major tech stocks declined from high openings, mainly due to reports that mainland China restricted banks and state-owned enterprises from using OpenClaw. In the second half, tech stocks all sold off. Futures in the US are down this morning, dragging Hong Kong futures to around 25,600. The Hang Seng opened lower, down 179 points, with early gains limited. The index once rose 33 points to 25,932 but then fell back after breaking the 26,000 level, dropping as much as 374 points to 25,524. Midday, it was down 318 points or 1.23%, at 25,579. The China Enterprises Index fell 63 points or 0.72%, to 8,641; the Tech Index dropped 60 points or 1.2%, to 4,994.

In the second half, if the Hang Seng cannot regain above 25,700 and stabilize the 5-day and 10-day moving averages, the market is likely to revisit the upward gap left on Tuesday, specifically the 25,442-25,611 and 25,357-25,535 futures gaps. If the market fully fills the upward gap but cannot hold above the top of the gap, staying above 25,600, a continued correction is possible. The key levels for a rebound are between 25,700 and 25,800. Failing to stabilize this range could lead to testing the 250-day moving average at 25,000. If that support is broken, the index could trend downward toward the heavy support zone at 24,600-24,800. However, given that Hong Kong stocks are still reasonably valued, even if the Hang Seng tests 25,000 or drops into the 24,600-24,800 zone, as long as Northbound funds controlling Hong Kong stocks do not withdraw massively, the medium-term upward trend remains intact.

MacDewen

(Xu Diyi, licensed by the SFC)