The Hong Kong stock market has moved lower in two of three trading days since the end of the three-day winning streak in which it had spiked almost 500 points or 2.7 percent. The Hang Seng Index finished just above the 18,870-point plateau, and now analysts are predicting a mild rebound at the opening of trade on Wednesday.
The global forecast for the Asian markets is cautiously optimistic, with many of the regional bourses remaining oversold and at attractive valuations. There also remains some positive sentiment regarding the Spanish bailout, although caution is starting to take hold. Further limiting the upside, investors will be cautious ahead of this weekend's critical vote in Greece. On the U.S. economic front, the Labor Department reported a drop in both import and export prices. The European and U.S. markets finished higher and the Asian bourses are expected to open in similar fashion.
The Hang Seng finished modestly lower on Tuesday following losses from the financial shares and the property stocks.
For the day, the index fell 81.07 points or 0.43 percent to finish at 18,872.56 after trading between 18,708.26 and 18,925.79 on volume of 41.55 billion Hong Kong dollars.
Among the actives, Wharf Holdings lost 2.7 percent, while Citic Pacific shed 0.5 percent and China Southern Airlines surged 6.6 percent.
The lead from Wall Street is positive as showed a strong move back to the upside on Tuesday, after moving sharply lower in the previous session. The markets benefited from bargain hunting following Monday's sell-off, as well as a pullback by Spanish bond yields. The bourses remain at relatively low levels after plummeting in May.
Traders also continued to digest news of a bailout for Spain, which has requested 100 billion euros from a euro area bailout fund in order to shore up its banking system. The Spanish ten-year bond yield hit a euro-era high during the day, but a pullback going into the close also contributed to the buying interest on Wall Street.
On the U.S. economic front, the Labor Department reported a 1.0 percent drop in import prices and a 0.4 percent fall in export prices in May. The drop in import prices, which compared to estimates for a 1.1 percent decrease, was largely due to a 4.2 percent decrease in prices for fuel imports.
Among individual stocks, shares of Texas Instruments (TXN) rose by 2.1 percent after the chip maker narrowed its second quarter guidance. Juniper Networks (JNPR) also ended the day higher after announcing a new stock buyback program to purchase up to $1 billion worth of its stock.
Meanwhile, shares of FactSet Research Systems (FDS) tumbled 12.3 percent after the financial information company reported better than expected third quarter earnings but provided disappointing fourth quarter guidance.
The major averages saw continued strength going into the close, ending the day near their highs for the session as the Dow jumped 162.57 points or 1.3 percent to finish at 12,573.80, while the NASDAQ advanced 33.34 points or 1.2 percent to end at 2,843.07 and the S&P 500 surged up 15.25 points or 1.2 percent at 1,324.18.
by RTT Staff Writer
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