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Hong Kong Stock Market Likely To Remain Rangebound

The Hong Kong stock market has alternated between positive and negative finishes through the last four trading days since the end of the seven-day winning streak in which it had surged more than 1,950 points or 7 percent. The Hang Seng Index now rests just above the 30,630-point plateau although it may head south again on Wednesday.

The global forecast for the Asian markets is mixed and flat, with oil and technology stocks likely to continue to weigh. The European and U.S. markets were mixed and little changed and the Asian bourses figure to follow that lead.

The Hang Seng finished sharply higher on Tuesday following gains from the casinos, financials, properties and oil companies.

For the day, the index advanced 312.81 points or 1.03 percent to finish at 30,632.64 after trading between 30,126.40 and 30,948.47.

Among the actives, Galaxy Entertainment skyrocketed 8.88 percent, while Sands China surged 7.53 percent, New World Development soared 5.17 percent, Sun Hung Kai Properties spiked 5.07 percent, AIA Group accelerated 4.77 percent, Henderson Land rallied 4.26 percent, Techtronic Industries jumped 3.63 percent, BOC Hong Kong climbed 3.48 percent, China Petroleum and Chemical (Sinopec) gathered 3.41 percent, CNOOC perked 3.38 percent, Xiaomi Corporation plummeted 3.10 percent, Industrial and Commercial Bank of China collected 2.73 percent, Hong Kong & China Gas advanced 2.67 percent, Hang Lung Properties tumbled 2.08 percent, Ping An Insurance added 2.07 percent, ANTA Sports skidded 1.97 percent, CITIC gained 1.97 percent, Meituan sank 1.85 percent, China Mengniu Dairy dropped 1.80 percent, CSPC Pharmaceutical rose 1.66 percent, Alibaba Group shed 1.20 percent, China Life Insurance increased 1.08 percent, WuXi Biologics lost 0.65 percent, AAC technologies fell 0.46 percent and China Resources Land was unchanged.

The lead from Wall Street suggests a hint of support as stocks staged a recovery after opening sharply lower on Tuesday as the Dow and S&P managed to pick into positive territory.

The Dow added 15.66 points or 0.05 percent to finish at 31,537.35, while the NASDAQ fell 67.85 points or 0.50 percent to end at 13,465.20 and the S&P 500 rose 4.87 points or 0.13 percent to close at 3,881.37.

The early sell-off on Wall Street reflected concerns about the outlook for inflation and the potential for higher interest rates due to the recent increase in bond yields. The yields on ten-year notes and thirty-year bonds reached their highest intraday levels since the early days of the coronavirus pandemic earlier in the day.

However, selling pressure waned after Federal Reserve Chair Jerome Powell's remarks before the Senate Banking Committee. Powell reiterated interest rates will remain at near-zero levels and the Fed will continue its asset purchases at the current rate until "substantial further progress" has been made toward its goals of maximum employment and price stability.

In U.S. economic news, the Conference Board said consumer confidence has improved more than expected in February.

Crude oil prices ended slightly lower on Tuesday after surging in the previous session. West Texas Intermediate Crude oil futures for April ended down $0.03 at $61.67 a barrel.

Closer to home, Hong Kong will see final Q4 numbers for gross domestic product later today, with forecasts suggesting an increase of 0.2 percent on quarter and a decline of 3.0 percent on year. That follows the 2.7 percent quarterly increase and the 3.6 percent yearly decline in Q3.

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