INVESTMENT DAILY

The Hang Seng Index is expected to trade at 23,500 to 23,900today

    HK stock was very volatile last Friday, the Hang Seng Index opened lower on earlysession, the decline extended to 219 points. However, as market expect ShanghaiHK interconnect will commence operation soon, Hang Seng Index reversed earlyloss and once increased 180 points. However, A share declined which depressed HKstock again. The Hang Seng Index closed the day 99 points lower at 23,550. H shareindex lost 29 points to 10,539. Market turnover extended to HK$73.2bn.

    HKEX(0388.HK) added 2.0%. Lenovo(0992.HK) quarter revenue increased belowexpectation, share price dropped 4.8% yoy.

    The U.S. Bureau of Labor Statistics report showed that the economy added 214,000jobs in October, while the unemployment rate further improved to 5.8%. Althoughthe non-farm payroll data is below expectation, US stock market continued itsstrength last Friday. The Dow closed the day 19 points higher (at 17,574) but theNasdaq dropped 6 points (to 4,633). Looking ahead, investors will continue to eyeon the corporate earnings (like Walmart) and economic data (retails sales data onFriday) to be announced this week.

    HK stock turned weak last week and fell below 10 Day SMA. However, as CSRCand HKEX announced that Shanghai HK interconnect will commence on 17 Nov, itwill help to lift HK market today. Looking ahead, investors will eye on A shareperformance as well as Tencent results to be released on Wednesday.

    Technical Analysis

    Hang Seng Index closed with gyro on last Friday, Technically, index closed at above20DMA (23,415), however the MACD bullish gap narrowed, showing thatmomentum remain week. Hang Seng index first support would be 20DMA (23,415),while next support would be at seen at 23,000. For resistance, 10DMA (23,684)would become the first resistance, while next resistance would be seen at 23,871.