The Hong Kong stock market has closed lower now in four straight sessions, giving away more than 980 points or 5 percent in that span. The Hang Seng Index finished just above the 18,920-point plateau, and now investors may finally be tempted to scoop up bargains when the market kicks off trade on Tuesday.
The global forecast for the Asian markets is cautiously optimistic after many of the regional bourses were brutally oversold last week - although the bargain hunting may be limited by persistent concerns from Europe. Spain may see another economic contraction in the second quarter of this year, Economy Minister Luis De Guindos reportedly said on Monday. The minister also denied that Spain needs any kind of external aid for its banking sector. The European and U.S. markets were higher on Monday and the Asian markets are expected to open in similar fashion.
The Hang Seng finished slightly lower on Monday, bumped into the red by softness from the financials - although the property stocks provided some support.
For the day, the index eased 29.53 points or 0.16 percent to finish at 18,922.32 after trading between 18,796.69 and 18,953.68 on volume of 46.00 billion Hong Kong dollars.
Among the actives, HSBC shed 1.0 percent and Tencent plummeted 3.4 percent, while China Overseas Land jumped 1.8 percent and China Resources Land climbed 1.1 percent.
The lead from Wall Street is upbeat as stocks saw significant strength on Monday, regaining some ground after falling to a four-month low on Friday. The markets benefited from bargain hunting but remain sharply lower for the month of May. The Dow ended a six-session losing streak, although it still marked just its second gain in fourteen sessions.
Trading activity was subdued, as lingering concerns about Europe and a lack of major U.S. economic data kept some traders on the sidelines. While reports on home sales, durable goods orders, and consumer sentiment will be in focus later this week along with earnings news from Hewlett-Packard (HPQ), Dell (DELL), and Best Buy (BBY), trading activity may remain light.
Among individual stocks, American Eagle Outfitters (AEO) posted a strong gain after the apparel retailer announced plans to exit its children's business 77kids. Shares of Yahoo (YHOO) also ended the day higher after the online media giant announced that it is selling up to half of its stake in Alibaba back to the Chinese e-commerce company for about $7.1 billion.
Meanwhile, Lowe's (LOW) posted a steep loss after the home improvement retailer reported better than expected first quarter results but lowered its full year earnings guidance. Shares of Facebook (FB) also came under pressure, with the social media giant tumbling by 11 percent following its glitch-plagued debut on Friday.
The major averages saw further upside going into the close, ending the session just off their highs. The Dow rose 135.10 points or 1.1 percent to finish at 12,504.48, while the NASDAQ jumped 68.42 points or 2.5 percent to end at 2,847.21 and the S&P 500 climbed 20.77 points or 1.6 percent to 1,315.99.
In economic news, China is on Tuesday scheduled to release April results from the Conference Board's leading and coincident indexes. The leading index saw a 0.8 percent increase in March, while the coincident was up 0.6 percent.
by RTT Staff Writer
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