Weekly Updates 13/5/24 – 17/5/24 May 13, 2024
This weekly update is designed to help you stay informed and relate economic and company earnings to potentially value-add your CFD (Contract For Difference) trading via hedging (risk reducing). This article should be used for educational purposes only and not as financial advice. We urge all traders to carry out your own due diligence before submitting trades.
Recap for last week (06 May 2024 – 10 May 2024)
*These prices are taken based on the previous Monday’s opening price and the preceding Friday’s closing price.
Last week’s market movement revolved around Chinese authorities hinting on potentially removing dividend withholding tax on Chinese companies listed on the Hong Kong Stock Exchange, causing dividend stocks to rally with Hang Seng Index closing 2.57% higher for the week. US indexes closed higher due to weaker than expected jobs report last week that resulted in lower bond yield due to market participants pricing in rate cuts towards the end of 2024.
Updates for the week (13 May 2024 – 17 May 2024)
The data below showing the economic releases read as “Analyst’s estimate/ Consensus | Previous data”.
Upcoming week macro-news releases focus on CPI data coming out of the US and Retail Sales, Industrial production data coming out of China. With all investors and traders paying attention to US Fed’s rate decisions, CPI is a big influence to that. Any major progress in combating CPI will likely result in a more dovish Fed while any setbacks will likely result in a more hawkish Fed. With recent mixed data coming out of China, investors are looking for more positive signs that the China economy is recovering.
This week’s corporate earnings mainly focuses on both US and Hong Kong stocks such as Walmart, Cisco, Home Depot, Grab, Sea limited from US and mega caps from Hong Kong like Alibaba, Tencent, ZTO Express and Baidu. Furthermore, SIA and ThaiBev from Singapore markets are releasing earnings this week. Main focus for the week will be Alibaba and Tencent earnings release on 14th May as it will set the tone and guidance for Hong Kong and China markets as a whole.
If you hold equity positions in these stocks, you can hedge your positions using CFDs to mitigate the risk of disappointing earnings releases.
For those looking to speculate or capitalize on the increased volatility, CFDs provide leverage and ease of going long and short across a broad range of products available. As CFD is traded on margin, there is a risk of losing more than your initial deposit amount and traders need to adopt proper risk assessment and management to determine if CFD is the product for you.
Sunny Optical (2382.HK): Daily Trend Change – by Alex Lee, Assistant Manager
Key Entry Price Pivot(s)
- HK$35.15
Recommended Trade
- Long at HK$40
- Stop Loss at HK$33.30
- Take Profit: HK$57.10
Alternative Case
- Take Profit: HK$57.10
- Stop Loss at HK$35.00
- Take Profit at HK$30.00
Remarks
- On the daily chart, Sunny Optical has changed trend and moved above the 20-moving average line.
- If Sunny Optical continues to show bullish momentum with significant volume, recommended trade suggests going long with a stop loss at the low at HK$33.30.
- Alternative case to short is presented in the event that price is able to close below the moving average line and breaks the low of HK$33.30, as this will serve as an indication that the momentum has shifted and poised to the downside.
If you have any feedback or questions, feel free to email us at samht@phillip.com.sg or onishathyeyn@phillip.com.sg or cfd@phillip.com.sg.
Disclaimer
This material is provided to you for general information only and does not constitute a recommendation, an offer or solicitation to buy or sell the investment product mentioned. It does not have any regard to your specific investment objectives, financial situation or any of your particular needs.
Accordingly, no warranty whatsoever is given and not liability whatsoever is accepted for any loss arising whether directly or indirectly as a result of your acting based on this information. Investments are subject to investment risks.
The risk of loss in leveraged trading can be substantial. You may sustain losses in excess of your initial funds and may be called upon to deposit additional margin funds at short notice. If the required funds are not provided within the prescribed time, your positions may be liquidated.
The resulting deficits in your account are subject to penalty charges. The value of investments denominated in foreign currencies may diminish or increase due to changes in the rates of exchange.
You should also be aware of the commissions and finance costs involved in trading leveraged products. This product may not be suitable for clients whose investment objective is preservation of capital and/or whose risk tolerance is low.
Clients are advised to understand the nature and risks involved in margin trading. You may wish to obtain advice from a qualified financial adviser, pursuant to a separate engagement, before making a commitment to purchase any of the investment products mentioned herein. In the event that you choose not to obtain advice from a qualifies financial adviser, you should assess and consider whether the investment product is suitable for you before proceeding to invest and we do not offer any advice in this regard unless mandated to do so by way of a separate engagement.
You are advised to read the trading account Terms & Conditions and Risk Disclosure Statement (available online at www.poems.com.sg) before trading in this product. Any CFD offered is not approved or endorsed by the issuer or originator of the underlying securities and the issuer or originator is not privy to the CFD contract. This advertisement has not been reviewed by the Monetary Authority of Singapore.
CFD Disclaimer
Investments are subject to investment risks. The risk of loss in leveraged trading can be substantial. You may sustain losses in excess of your initial funds and may be called upon to deposit additional margin funds at short notice. If the required funds are not provided within the prescribed time, your positions may be liquidated. The resulting deficits in your account are subject to penalty charges. The value of investments denominated in foreign currencies may diminish or increase due to changes in the rates of exchange. You should also be aware of the commissions and finance costs involved in trading leveraged products. This product may not be suitable for clients whose investment objective is preservation of capital and/or whose risk tolerance is low. Clients are advised to understand the nature and risks involved in margin trading.
You may wish to obtain advice from a qualified financial adviser, pursuant to a separate engagement, before making a commitment to purchase any of the investment products mentioned herein. In the event that you choose not to obtain advice from a qualified financial adviser, you should assess and consider whether the investment product is suitable for you before proceeding to invest and we do not offer any advice in this regard unless mandated to do so by way of a separate engagement. You are advised to read the trading account Terms & Conditions and Risk Disclosure Statement (available online at https://www.poems.com.sg/) before trading in this product.
Any CFD offered is not approved or endorsed by the issuer or originator of the underlying securities and the issuer or originator is not privy to the CFD contract.
This advertisement has not been reviewed by the Monetary Authority of Singapore.
This material is intended for general circulation only and does not take into account the specific investment objectives, financial situation or particular needs of any particular person. You should seek advice from a financial adviser regarding the suitability of the investment product, taking into account your specific investment objectives, financial situation or particular needs, before making a commitment to invest in such products.
About the author
Sam Hei Tung (Dealing) and Onisha Thye (Dealing)
Sam graduated from National University of Singapore with a Master of Science in Finance. He personally manages his own investment portfolio and does equity and economic research in his free time. Sam believes that education and information is essential to making good financial decisions.
Onisha is a dealer at the CFD Dealing Desk. She graduated from Monash University with a double major in finance and econometrics. Her natural curiosity for finance is what drove her to be in this field as she is fascinated by all the possibilities and opportunities that are available to grow one’s wealth, either through trading or investment.
