The HK50 jumped to 24,177 after finding support at the October high of 23,232. That will provide support for the uptrend with highs at 24,876.
US President Donald Trump announced a tentative ceasefire agreement between Iran and Israel, adding to risk appetite and easing concerns about oil disruption. The CSI 300 jumped 2.1%, with the same move higher in the Shanghai Composite Index.
Trump said on Monday that Israel and Iran had agreed to a 24-hour truce just days after his strike on Iran’s territory. Iran had attacked US air bases in return and threatened to shut a major shipping lane for crude oil.
Global investors are looking at Hong Kong as a reliable safe haven due to the city’s strength in stock markets and wealth management, according to Hong Kong Financial Secretary Paul Chan Mo-po.
Despite an uncertain global political and economic environment, Hong Kong’s status as a free port and its strong legal system is a key reason why foreign investors are choosing the Hong Kong market over domestic Chinese stocks.
The average daily volume on the Hong Kong stock exchange has grown to HK$240 billion this year, while IPO fundraising is leading the world.
“It is expected that within the next two to three years, Hong Kong will become the world’s leading cross-border asset management center,” Chan added.
As European and US stocks stutter at all-time highs, the flows into Hong Kong should remain supported as a diversification opportunity.
The Middle East situation has cooled on a “tentative” agreement, but caution is still advised as stocks approach their recent highs. The levels noted on the HK50 give the support and resistance for a breakout higher or a correction. A consolidation period is also possible if traders show indecision.
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