Overbought Hang Seng May Correct To The Downside

(RTTNews) - The Hong Kong stock market has alternated between positive and negative finishes through the last four trading days since the end of the three-day winning streak in which it had rallied more than 820 points or 3.9 percent. The Hang Seng Index now rests just above the 22,620-point plateau although it's likely to see profit taking on Monday.

The global forecast for the Asian markets is flat to lower, with energy stocks likely to lead the way lower. The European and U.S. markets were mostly lower and the Asian bourses figure to follow that lead.

The Hang Seng finished with enormous gains on Friday with support in all sectors, although the technology companies were especially strong.

For the day, the index skyrocketed 805.93 points or 3.69 percent to finish at the daily high of 22,620.33 after moving as low as 22,027.07.

Among the actives, Alibaba Group surged 6.34 percent, while Alibaba Health Info skyrocketed 29.10 percent, ANTA Sports rallied 4.13 percent, China Life Insurance spiked 5.56 percent, China Mengniu Dairy improved 2.55 percent, China Resources Land strengthened 3.70 percent, CITIC added 2.22 percent, CNOOC eased 0.11 percent, CSPC Pharmaceutical soared 5.73 percent, Galaxy Entertainment rose 1.88 percent, Haier Smart Home advanced 2.97 percent, Hang Lung Properties increased 2.44 percent, Henderson Land perked 0.47 percent, Hong Kong & China Gas fell 0.16 percent, Industrial and Commercial Bank of China collected 1.24 percent, JD.com surged 7.59 percent, Lenovo and Li Auto both jumped 3.78 percent, Li Ning accelerated 4.74 percent, Meituan spiked 6.39 percent, New World Development climbed 3.37 percent, Nongfu Spring gained 2.12 percent, Techtronic Industries gathered 0.84 percent, Xiaomi Corporation soared 7.32 percent and WuXi Biologics skyrocketed 11.77 percent.

The lead from Wall Street is weak as the major averages opened higher on Friday but couldn't hold the gains, finishing mixed and little changed.

The Dow dropped 165.32 points or 0.37 percent to finish at 44,546.08, while the NASDAQ added 81.17 points or 0.41 percent to close at 20,026.77 and the S&P 500 dipped 0.44 points or 0.01 percent to end at 6,114.63.

For the week, the NASDAQ surged 2.6 percent, the S&P 500 jumped 1.5 percent and the Dow advanced 0.6 percent.

The choppy trading on Wall Street came as traders expressed some uncertainty about the near-term outlook for the markets following Thursday's rally, which saw the S&P 500 jump near its record highs despite data showing a bigger than expected increase by producer prices.

Traders were also digesting a mixed batch of U.S. economic data, including a Commerce Department report showing retail sales slumped much more than expected in January. A separate report from the Federal Reserve showed industrial production rose by more than expected last month.

Oil prices drifted lower on Friday as supply concerns eased amid hopes of a peace deal between Russia and Ukraine and possibility of removal of sanctions on Russia. West Texas Intermediate Crude oil futures fell $0.55 or 0.77 percent at $70.74 a barrel. WTI futures gained 1.0 percent for the week.