. SVB Collapse Triggers Global Market Fall - 14 March 2023

SVB Collapse Triggers Global Market Fall – 14 March 2023

14 Mar 2023

Hang Seng Index Under Pressure as SVB Collapse Sparks Contagion Fears.

SVB collapse causes contagion fears, and global markets fall.

China and Hong Kong stocks plummet, and banking shares take the hit.

China and Hong Kong stocks suffered a sharp decline on Tuesday, with fears of contagion from the collapse of Silicon Valley Bank (SVB) continuing to impact the markets.

The blue-chip CSI300 Index in China was down 0.8%, reaching its lowest level since January, while Hong Kong’s benchmark Hang Seng index and China Enterprises index both slumped by 1.8%.

Banking shares saw significant losses, as concerns about a possible US banking crisis sent shockwaves through Asian markets. The S&P Banking Index fell by 7% overnight. Chinese financial shares dropped by 1.2%, and bank shares lost 0.7%, while Hang Seng’s finance subindex fell by 2.6%.

The markets also reacted to news that Chinese President Xi Jinping is planning to visit Russia to meet with Vladimir Putin next week.

US President Joe Biden, who recently unveiled a submarine deal to counter China, said he expected to speak with Xi soon, but did not give a date.

In addition, tech giants listed in Hong Kong experienced a 2.1% drop, with Alibaba losing 3.7% and Maiduan down 2.8%.

Chinese tourism stocks, airline shares, and hotel operators also fell, despite news that China would reopen its borders to foreign tourists by restoring the issuance of all types of visas from Wednesday.

Hong Kong’s share market finished the session lower on Tuesday, 14 March 2023, on tracking negative cues from Wall Street overnight, with financial-related stocks leading losses as fear of a U. S. banking crisis following the collapse of two regional U. S. banks.

Markets remained nervous about contagion fear following the collapse of Silicon Valley Bank last week and the failure of New York’s Signature Bank over the weekend even after the U.

S. government took steps to shore up systemic confidence.

At the closing bell, the benchmark Hang Seng Index dropped 448.01 points, or 2.27%, to 19,247.96. The Hang Seng China Enterprises Index declined 151.23 points, or 2.29%, to 6,439.

Among blue chips, HSBC sank 4.7% to HK$53.65, after the bank announced on Monday that it would swoop in to buy SVB’s UK subsidiary for a nominal 1. Insurer AIA Group plunged 4.4% to HK$80.75. Alibaba Group Holding dropped 3.9% to HK$80, Baidu fell 3.7% to HK$129 while Tencent slid 0.9% to HK$341.60.

HANG SENG TECHNICAL ANALYSIS DAILY CHART:

Hang Seng is currently trading in the down channel.

Hang Seng is currently trading below all SMA.

RSI is in the selling zone which suggests bearishness and Stochastic is suggesting no trend.

Hang Seng’s immediate resistance is at 19647 & its immediate support level is 19306

HOW TO TRADE HANG SENG IN THIS WEEK

Hang Seng is trading in the down Channel; it is broken its important support level and the previous day low; it will continue to trade downside until any trend reversal.

TRADE SUGGESTION-SELL AT 19288.33, TARGET AT 19162.92, SL AT 19382.20