講起阿根廷
半年前57蚊買咗百零股argt,睇下米萊有冇本事令國家由左轉右
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Hong Kong is starting to come to terms with its beloved stock market’s miserable decline, and that it may not be bottoming out any time soon.
An alarming trend is dogging the Hang Seng this holiday season. In the past, a weaker US dollar would propel strong stock performance in Hong Kong, as the city’s financial conditions loosened and dollar-based investors came to emerging Asia seeking better returns. But lately, this historical correlation seems to be broken. Since November, the Hang Seng has fallen 4.5% even as the dollar eased by 5.2%. On Dec. 11, the blue-chip index at one point dipped below 16,000, a psychologically important level for the city of 7.3 million. The Hang Seng is down 16% year-to-date, while the S&P 500 soared 24%.
This has prompted some soul-searching, with traders asking what the government can do to prevent its $3.8 trillion stock market from falling into oblivion. Foreign portfolio outflow is an issue, and the government has been keen to repair the financial center’s reputation after its crackdown of the 2019 pro-democracy movement and then three years of Covid-related border lockdowns.
But some say that’s not enough, that Hong Kong is now a dangerous place for global investors to park their money because of its heavy-handed enforcement of the National Security Law and the risk of US sanctions that may result. As pro-democracy media tycoon Jimmy Lai goes on trial, drawing negative global headlines, some in the city are arguing a lenient sentencing could be a conciliatory gesture. After all, Lai has already been held in pre-trial detention for more than 1,000 days, as the US government has pointed out. Every resident has realized the potency of the new security law, so why push the case any further?
Unfortunately, even freeing Lai — an improbable blue-sky scenario for some — can’t arrest the Hang Seng’s decline. This is because the perception of Hong Kong among mainland investors, a large and important trading bloc, is also changing.
In recent days, Chinese investors have been offloading their shares through the stock connect, especially after the Communist Party’s annual economic work conference that concluded with no hint of big stimulus. Building a “modern industrial system,” with an emphasis on developing cutting-edge technology and artificial intelligence, was made the No. 1 goal, while boosting domestic demand was downgraded to the second spot. This policy shift makes the Hong Kong bourse, where banks, real estate developers and consumer names dominate, even more unappealing than, say, Shanghai or Shenzhen. Industrials account for only 4% of its market value. Meanwhile, the percentage of loss-making firms listed on the exchange hit a decade high of 47% this year. It’s no surprise — companies from mainland China account for over 70% of the entire market, and they are struggling with a deflationary economy and belt-tightening consumers. We’ve seen a similar — though less extreme — case before. In 2016, the Hang Seng did not get a boost from a weaker dollar either; it was affected by a stock bubble burst in the north. Just like then, all we can do is to sit tight and wait, for the mainland’s property bubble to completely pop and its economy to start turning — whenever that may be.
After all, Hong Kong is a small, open economy. Its fate is dictated by the world’s biggest powers. Be patient, my friend. See you in 2024.