The situation looks like a falling knife for Hong Kong equities – Natixis
|Hong Kong stocks have gone from hero to zero with seemingly endless waves of regulations. Alicia Garcia Herrero , Chief Economist Asia Pacific at Natixis, analyzes the drivers behind the weakness of Hong Kong’s equity market and its outlook.
Why Hong Kong equity performance is the weakest in Asia?
“The tailwind in tech-related listings has now become a headwind in stock performance, which is in conjunction with the weakness of the HKD.”
“The signs of capital outflows in Hong Kong are in clear contrast to renewed foreign inflows into Asian shares.”
“The FED’s tapering is a risk for Asia, but even more for Hong Kong with a dollar peg. This means Hong Kong financial conditions could be tighter passively with extra pressure from the broader and tighter regulatory crackdown in Mainland China.”
“The situation looks like a falling knife, which may push investors to diversity through other Asian markets.”
Information on these pages contains forward-looking statements that involve risks and uncertainties. Markets and instruments profiled on this page are for informational purposes only and should not in any way come across as a recommendation to buy or sell in these assets. You should do your own thorough research before making any investment decisions. FXStreet does not in any way guarantee that this information is free from mistakes, errors, or material misstatements. It also does not guarantee that this information is of a timely nature. Investing in Open Markets involves a great deal of risk, including the loss of all or a portion of your investment, as well as emotional distress. All risks, losses and costs associated with investing, including total loss of principal, are your responsibility. The views and opinions expressed in this article are those of the authors and do not necessarily reflect the official policy or position of FXStreet nor its advertisers.