TOM & All.... Copy of morning report notes, 1/9/98, 7:00AM CST.
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HONG KONG STOCKS - Summary Report 1998-01-09
Deeply scarred by the SE Asian Currencies: Index closed 8,894 (-360)
The Thursday US market opened low and quickly dropped for 80 points.
The market then struggled along the 7800 support and finally closed
at 7802 (-99). The 30-year Treasury was last traded at a yield of
5.741%. The London Reference Index for HK Stock closed at
9,126 (-128).
This morning the HK market opened low at 8971 (-283) and quickly
dived to the intraday low of 8,721 (-523). Some buyers appeared and
the market was pushed back to the 9000 level. The morning market
closed at 8945 (-309) with a half day turnover of 6.67 bil. HK$.
In the afternoon, continued to struggle along the 9000 edge, and
finally closed at 8894 (-360), total turnover was 11.65 bil. HK$.
Market News
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(1) After market closed, the Bank Association determined to raise the
prime rate by 0.75%.
(2)There is a general fear that China's currency is under pressure for
devaluation to match up with the regional currency crisis, in order to
support export. The H shares and red chips were hit hard, both lost close
to 25% this year.
Market Watch
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With the deep plunge in the US market, today the HK market opened low
as expected. The interbank loan was also pushed high, with an
exceptional high spread. (Normally the borrowing and lending rates
differ by 1%, but today the one month borrowing rate was 10% while
the lending rate is 15%.)
The other SE Asian stock markets like Philippine and Singapore also
dropped for around 8%.
Apparently this wave of currency attack will probably last till
Tuesday next (Jan. 20, 1998) as we suggested yesterday.
At the moment when this report was prepared, the London Reference
Index for HK Stocks has dropped for another 530 points. Apparently
the next support will be at around 8000.
Stock Alert
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Many blue chips and China H shares are slashed heavily. The selling is
irrational and panicky. The daring may make a killing. |
