HONG KONG (AFP) — Hong Kong shares face a volatile ride in the coming week as the market looks to Wall Street and regional bourses for direction in the run-up to the Beijing Olympics, analysts said Friday.
For the week ending July 25, the benchmark Hang Seng Index closed up 866.52 points, or 3.96 percent, at 22,740.71.
DBS Vickers analyst Peter Lai said investors would be heavily influenced by Wall Street and the performance of other Asian bourses, as well as US economic data on the job market and consumer confidence.
"The market will be like a roller coaster next week, as it will be news-driven and sentiment-oriented," Lai told AFP.
"I expect the index will drop to 22,100 in the first couple of days next week on profit-taking," he said, adding that the index would likely rise to 23,000 later in the week.
But Lai said he was confident the uncertainties would be short-term and believed the index would climb to around 24,000 by the end of the third quarter.
"I think the Chinese government will loosen its monetary policies soon as it wants to maintain its image as a stable and prosperous country during the Olympics," he said.
The analyst said he believed crude oil prices had peaked and were now on its downward trend.
Fulbright Securities' general manager Francis Lun was also optimistic, saying the local equities market was only taking a breather.
"That is merely consolidation before more upside," he told Dow Jones Newswires.
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