RTTNews - The winning streak for the Hong Kong stock market has finished higher now in five straight sessions, surging more than 2,200 points or 13 percent on its way to a 10-month closing high. The Hang Seng Index has finished above the 19,500-point level, and now investors are optimistic that the market will have more upside when it kicks off trade on Tuesday.
The global forecast for the Asian markets is optimistic as bourses around the world continue to be buoyed by solid corporate earnings news. Commodities are tipped to extend their rebound after suffering through much of last week, while the airlines and properties also are due to rise. The European and U.S. markets all finished firmly in positive territory, and the Asian markets are projected to follow that lead.
The Hang Seng finished sharply higher on Monday, thanks to solid gains among the financials and properties. For the day, the index soared 696.71 points or 3.7 percent to close at 19,502.37 after trading between 18,960.54 and 19,506.42 on turnover of 77.73 billion Hong Kong dollars.
Among the gainers, Ping An Insurance rose 10.3 percent, while China Life jumped 6.5 percent, Swire Pacific gained 6.6 percent, HSBC added 3.1 percent, Cheung Kong was up 5.6 percent, Wharf Holdings jumped 7.4 percent, Sino Land gained 5.3 percent, Sun Hung Kai Properties added 5.1 percent and China Mobile was up 3.3 percent.
The lead from Wall Street continues to be broadly positive as stocks posted strong gains on Monday, boosted by promising earnings results and reassuring news from commercial lending giant CIT Group (CIT). The major averages kicked off the week on a positive note, finishing in positive territory by solid margins.
In earnings news, Halliburton Co. (HAL), M&T Bank Corp. (MTB), Hasbro (HAS), Eaton (ETN) and Johnson Controls (JCI) all reported quarterly results that largely exceeded Wall Street expectations, bolstering trader optimism. This morning, some trader concern regarding the bankruptcy of CIT Group was alleviated, as the lending giant reportedly secured $3 billion in financing from some of its largest bondholders.
On the economic front today, the Conference Board released a report showing that its index of leading economic indicators increased by more than expected in June, although both the coincident index and lagging index continued to decline. The report showed that the leading indicators index increased by 0.7 percent in June following an upwardly revised 1.3 percent increase in May. Economists had expected the index to increase by 0.5 percent compared to the 1.2 percent increase originally reported for the previous month.
In other news, Dennis Lockhart, president of the Federal Reserve Bank of Atlanta, predicted modest growth starting in the second half of the year, though he said there is not likely to be a strong recovery in the medium term.
The major averages saw further upside heading into the close, finishing near their best levels of the day. The Dow advanced by 104.21 points or 1.2 percent to 8,848.15, the NASDAQ climbed by 22.68 points or 1.2 percent to 1,909.29 and the S&P 500 rose by 10.74 points or 1.1 percent to 951.13.
In economic news, Hong Kong is on Tuesday scheduled to announce consumer price index data for June, with analysts predicting a 0.5 percent contraction on year following the flat annual reading a month earlier.
Also, Hong Kong's seasonally adjusted jobless rate edged up to 5.4 percent in the April to June period from 5.3 percent in the preceding three months, the Census and Statistics Department said on Monday. The rate came in line economists' estimates.
During the period, the number of unemployed persons, on an unadjusted basis, increased by around 3,300 persons to 203,000 from the three months ended May. However, the number of underemployed persons fell by 300 to 84,900.
At the same time, the number of employed persons decreased by 8,700 to 3.51 million. Over the same period, the labor force decreased by around 5,500 persons to 3.71 million.
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