Mourinho's Daily Review: Hang Seng Index surges past June high! Virtual asset license surprise, A-shares are about to take off.
Hello everyone, today the market $Hang Seng Index(00HSI.HK) continued its strong upward trend from yesterday, further approaching this year's high of ~24,874 points. The market opened higher and continued to rise today, with a surge of over 300 points at one point, breaking through June's high to reach today's peak of ~24,533 points, just a step away from this year's high. As I mentioned yesterday, the market has already started a new upward wave, gradually entering a bull market phase. Today, the market continued to climb, further boosted by the strong performance of A-shares $SSE Index(000001.SH), which broke this year's new high of ~3,459 points. The most explosive positive news today was $GUOTAI JUNAN I(01788.HK) receiving approval from the Hong Kong Securities and Futures Commission to upgrade its existing securities license to a comprehensive one that includes virtual asset trading and related advisory services, making it the first Hong Kong-based Chinese brokerage to obtain such qualifications. As a result, market sentiment was very positive today, and the market ended near its high at 24,474 points. Trading volume also increased significantly today, exceeding HKD 250 billion, totaling HKD 267.8 billion, indicating very active and robust trading.
The main reasons for today's high opening and continued rise, aside from the aforementioned factors, were initially driven by the strong performance of the three major U.S. indices overnight: $Dow Jones Industrial Average(.DJI.US), $NASDAQ Composite Index(.IXIC.US), and $S&P 500(.SPX.US). Additionally, today saw more sectors performing well beyond just the financial sector, including previously underperforming domestic property and real estate stocks. Among the blue chips, the best performers were $HANG LUNG PPT(00101.HK), $HENDERSON LAND(00012.HK), $CHINA OVERSEAS(00688.HK), and $SHK PPT(00016.HK). The financial sector, which has been consistently strong, continued to attract capital, especially today's new highs for domestic insurance leaders $PING AN(02318.HK) and $CHINA LIFE(02628.HK). Among domestic banks, $CCB(00939.HK), $ICBC(01398.HK), and $CM BANK(03968.HK), along with blue-chip heavyweights $HSBC HOLDINGS(00005.HK) and $AIA(01299.HK), all hit new highs today. The financial sector is undoubtedly the strongest sector this year, bar none.
On the other hand, for the market to break this year's high or reach 25,000 points, I believe it must activate the upward momentum of blue-chip tech heavyweights, especially the stock king $TENCENT(00700.HK). Its stock price has been in a sideways trend so far today, and even today's best performer, $BABA-W(09988.HK), has yet to return to this year's high. The weakest performer, $MEITUAN(03690.HK), remains at the bottom. As a result, the $Hang Seng TECH Index(STECH.HK) has yet to break June's high of ~5,484 points, significantly lagging behind the Hang Seng Index. For investors bullish on the Hang Seng Tech Index to follow the Hang Seng Index and break June's high or even this year's high of ~6,195 points, they may consider tracking or investing in the ETF issued by ChinaAMC that tracks the Hang Seng Tech Index: $CAM HS TECH(03088.HK).
Today, the brokerage sector performed well collectively due to the positive news about $GUOTAI JUNAN I(01788.HK), including $CC SECURITIES(01375.HK), $CMSC(06099.HK), $CITIC SEC(06030.HK), and $BRIGHT SMART(01428.HK). The strong performance of brokerages is a sign that the Hong Kong and A-share markets are about to enter a bull market. Additionally, the chip sector also performed well today, including $HUA HONG GRACE(01347.HK) and $SHANGHAI FUDAN(01385.HK), with the best performer being one of the blue chips, $SMIC(00981.HK).
Finally, recent market focus has been on virtual assets, whether it's stablecoin issuer $Circle(CRCL.US), Bitcoin's strong rebound above $100,000, or Ethereum's return to $2,400, all attracting capital to related products. The simplest way to participate in these products is through ETFs. For investors long-term bullish on Bitcoin, they may consider tracking or investing in $CAM BTC(03042.HK). Similarly, for investors long-term bullish on Ethereum, they may consider $CAM ETH(03046.HK).
Summary
The market has rebounded from last week's low of ~23,185 points to today's high of ~24,533 points, gaining over 1,300 points in just four days. The new upward wave will undoubtedly challenge this year's high of ~24,874 points, as many fund managers will likely window-dress their portfolios before the mid-year review. Therefore, the market is well-positioned to break this year's new high in the coming days.
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