19 Jul 2019
With the interest rates cut being likely to take place at the end of the month, following U.S. Federal Reserve Chairman Jerome Powell’s testimony earlier this month and further comments made by Fed officials, Hong Kong shares went up on Friday.
There was a 1.1% increase by the Hang Seng, taking it to 28,765.40 and Tencent Holdings, rose by 1.5%. It was reported that Tencent has agreed to work with BMW to construct an establishment to work on technology for self-driving cars in China. Insurance companies AIA Group and Ping An Insurance Group both had an increase in shares, with the former rising 2.7% and the latter going up by 1.4%. The Shanghai Composite Index also inclined by 0.8%.
On the other hand, there was a drop in Coolpad Group’s stocks, going down by 46.5% whereas FIH Mobile’s stock went up by 1.2%. MTR, which is based in Hong Kong, also saw a decline of 2.7%. Shanghai Fudan-Zhangjiang Bio-Pharmaceutical’s stock rose by 8.9%.
During the week, several authoritative figures spoke about the cutting of interest rates. John Williams, who is acting as New York Federal Reserve President called for quick actions and ‘quickly…lower rates at the first sign of economic distress.’ Moreover, Fed Vice Chairman Richard Clarida expressed his disappointment after the central bank took its time to take action, saying that is did not ‘need to wait until things get so bad to have a dramatic series of rate cuts.’