1. Jardine C&C -2.600
2. JMH 400US$ -1.990
3. JSH 500US$ -1.150
4. UOB -0.420
5. HKLand US$ -0.350
US markets fell at least 2% after US Fed Chief gave a down beat assessment on the US economy despite rolling out the stimulus "operation twist" which involved selling short-term debt and using that amount to purchase the long-term debt. Such a move will drive the mortgage rates to the lowest possible lowest rate so that this will allow people to refinance, get more disposable income in people's pockets. Unlike the previous QE1 & QE2, this time round US Fed did not print money as it will not have the impact of have excess liquidity to flow into the stock markets and causing inflation in Asian countries. Whether the "operation twist" move will be able to prevent US economy from falling into recession is yet to be seen. The other concern is the high unemployment rate which need President Obama's propose job plan to be passed as bill in the Congress. Failing to do that will probably resulting in US falling into recession. The bearish outlook of US Fed Chief's view on the economy was what caused the stock markets to pull back. Asian bourses tracking that all fell today. Nikkei closed -2.07%, SSE -2.78% ( awaiting for manufacturing data ) and HSI -4.85%. The sharp drop in HSI probably due to the strengthening of USD as HKD is being pegged to USD. STI fell 2.55% with all 30 index stocks closed in the red in a moderate volume day. Speculators that bought prior to the US Fed decision on stimulus were caught as no surprise from US Fed move on the stimulus but the unexpected bearish view probably caught most by surprise.
At the moment, despite the fall in stock markets, in general still do not have confirm economic data to indicate US economy is going into recession. There isn't any catalysts presently to cause the markets to a new downtrend or negative the current bearish trend.
