USDX
98.900

0.00%

XAUUSD
4523.85

0.36%

WTI
86.852

0.93%

EURUSD
1.16567

0.03%

GBPUSD
1.34523

0.01%

USDJPY
159.338

0.05%

USNDAQ100
30345.55

0.24%

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Risk Warning on Trading HK Stocks

Despite Hong Kong's robust legal and regulatory framework, its stock market still faces unique risks and challenges, such as currency fluctuations due to the Hong Kong dollar's peg to the US dollar and the impact of mainland China's policy changes and economic conditions on Hong Kong stocks.

HK Stock Trading Fees and Taxation

Trading costs in the Hong Kong stock market include transaction fees, stamp duty, settlement charges, and currency conversion fees for foreign investors. Additionally, taxes may apply based on local regulations.

HK Non-Essential Consumer Goods Industry

The Hong Kong stock market encompasses non-essential consumption sectors like automotive, education, tourism, catering, and apparel. Of the 643 listed companies, 35% are mainland Chinese, making up 65% of the total market capitalization. Thus, it's heavily influenced by the Chinese economy.

HK Real Estate Industry

In recent years, the real estate and construction sector's share in the Hong Kong stock index has notably decreased. Nevertheless, as of 2022, it retains around 10% market share, covering real estate development, construction engineering, investment, and property management.

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      Market Unmoved Despite Bailey's Assurances

      Summary:

      Bank of England (BoE) Governor Andrew Bailey indicated that in order to support the fragile UK economy, the central bank may tolerate a temporary overshoot of inflation above its 2% target, provided that no "second-round price effects" emerge.

      Buy GBPUSD
      EXP
      Trading

      1.34354

      ENTRY

      1.37700

      TGT

      1.32000

      SL

      1.34523 -0.00016 -0.01%

      0

      Point

      Flat

      1.32000

      SL

      CLOSING

      1.34354

      ENTRY

      1.37700

      TGT

      Fundamentals

      On Friday, BoE Governor Andrew Bailey noted that the central bank has effectively tightened monetary conditions and impacted the economy by extinguishing market expectations for rate cuts. Bailey stated, "Given the weakness in the real economy and the uncertainty over the scale and duration of the shocks, tolerating inflation temporarily above target to provide some support to the real economy is the appropriate way to manage this trade-off." He added, "However, our tolerance will diminish at any sign of second-round effects."
      Market Observation: Driven by the decline in crude oil prices and a cooling of inflation expectations, traders are currently wagering that the BoE will hike interest rates only once this year. Money markets are now pricing in a cumulative 36 basis points of hikes by year-end, representing the lowest expectation in over a month.
      Our View: However, we believe the reality behind the BoE's "no rush to hike" stance is brutally harsh. Shipping transit volumes through the Strait of Hormuz in the Middle East remain bottlenecked at just 5%, meaning the remaining 95% of shipping capacity remains paralyzed and cut off. According to Goldman Sachs, global oil inventories are depleting at a record pace of 8.7 million barrels per day, which explains the extreme tightness in global physical oil markets. As the UK is highly dependent on energy imports, domestic prices are bound to skyrocket sooner or later.
      Market Unmoved Despite Bailey's Assurances_1

      Technical Analysis

      The intraday bias for GBPUSD has turned neutral as the pair shows signs of stabilizing. On the downside, a break below 1.3300 would extend the decline from 1.3658, with the sell-off expected to find a floor around the 1.3260 zone. On the upside, a break above 1.3509 would likely extend the recovery momentum initiated from 1.3300.

      Trading Recommendations

      Trading Direction: Buy
      Entry Price: 1.3400
      Target Price: 1.3770
      Stop Loss: 1.3200
      Validity Until: 2026-06-28 23:55
      Support Levels: 1.3368, 1.3300, 1.3260
      Resistance Levels: 1.3509, 1.3567, 1.3658
      Risk Warnings and Investment Disclaimers
      You understand and acknowledge that there is a high degree of risk involved in trading with strategies. Following any strategies or investment methodologies is the potential for loss. The content on the site is being provided by our contributors and analysts for information purposes only. You alone are solely responsible for determining whether any trading assets, or securities, or strategy, or any other product is suitable for you based on your investment objectives and financial situation.

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      Eva Chen

      Analysts

      Master of Economics, 8 years in the financial industry, CFA holder, joined HSBC (Hong Kong) Bank in 2013 after graduating from the University of California, USA in the Investment Research and Markets Department. With years of financial market experience and trading experience, having provided excellent investment advice to many brokerages, entity derivatives importers and clients in Greater China.

      Rank

      3

      Articless

      2543

      Win Rate

      60.52%

      P/L Ratio

      0.59

      Focus on

      XAUUSD, WTI, GBPUSD

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