Jinwu Financial News | On May 21, after four weeks of continuous rise and a cumulative increase of nearly 3,500 points, Hong Kong stocks finally showed a backlash adjustment. The Hang Seng Index fell by close to 420 points and closed at the level of 19,200 points. It is estimated that it can still be maintained at a high level. However, we still maintain this view that Hong Kong stocks have reached a phased high level. It is estimated that it will still be quite difficult for the Hang Seng Index to rise above 20,000 points and stand firm in the short term. Meanwhile, the market's turnover remained strong, with a record of more than 150 billion yuan, but it also continued to decline for the third day since the daily turnover of more than 200 billion yuan last Thursday, showing that the market has returned to a rational and healthy stage during the phased peak of excitement indicated by us last week. It also once again verifies the inertia of the market often peaking in large volumes. It is worth noting that domestic housing stocks have become the latest focus of the market in recent days. Whether they can maintain overall stability will probably be a key factor affecting the market atmosphere. Currently, several domestic housing stock leaders, including China Overseas (00688), Longhu Group (00960), and China Resources Land (01109), are in the consolidation phase after a short-term sharp rise, and there is no significant change in trend. Among them, Longhu Group has also seen a slight increase of 0.26% against the market, so we can continue to follow up.

Hong Kong stocks opened low but continued to shrink, closing close to the daily low of 19,175 points. After Monday's recovery, the Hang Seng Index's 9-day RSI index has fallen back to 67.37. The serious technical overbought situation has been mitigated. It is expected that it will continue to stay above the 10-day line and maintain a pattern of high operation first. Index stocks generally showed a backlash. Among them, new energy vehicles fell collectively. Ideal Automobile-W (02015), which had poor performance in the first quarter compared to expectations, led the decline, falling 19.26% to close at 80.65 yuan. In the face of a sharp decline, it is believed that the current selling pressure is still there, but it is estimated that carrying capacity may gradually develop below 80 yuan. Furthermore, Tencent (00700), one of the locomotives leading the way recently, also dropped 2.88% to 383.6 yuan. It has returned to a level close to the level before the results were announced last Tuesday. We can pay attention to short-term low absorption opportunities.

The Hang Seng Index closed at 19,221 points, down 416 points, or 2.11%. The national index closed at 6821 points, down 144 points, or 2.06%. The Hang Seng Index closed at 3,981 points, down 155 points, or 3.74%. In addition, the main board volume of Hong Kong stocks was over $15.5 billion, while the short selling amount was $21.56 billion, or 14.32%. As for the ratio of rising and falling shares, 462:1266, there were 46 stocks that rose more than 13% during the day, while 49 stocks fell by more than 10% during the day. The Hong Kong Stock Connect showed a net inflow on the fourth day, and recorded a net inflow of nearly 500 million yuan on Tuesday.

Author: Ye Shangzhi, First Shanghai Chief Strategist