HashKey Jeffrey: Hong Kong stocks continue to soar, and the world is caught in a liquidity competition

Author: HashKey Jeffrey

Since the US interest rate cut, the global securities market has ushered in the dawn of recovery. Following the A-share market, the Hong Kong stock market has also set off a rare trading frenzy. According to today's closing data, the Hong Kong Hang Seng Index soared 6.2%, and the technology index soared 8.5%. Since September 11, the Hang Seng Index has almost risen in a straight line, and has now reached 22,448 points, approaching the 22,689 points set on January 27, 2023, the highest point in nearly 31 months.

The trading volume of the Hong Kong stock market has exceeded the trillion mark for several consecutive days, and huge buy orders have poured in like a tide. The trading volume is so large that the exchange server has experienced trading delays. Similar grand occasions can be traced back to 2015. The sharp rise in prices has been strongly supported by trading volume, which is a clear bullish signal, indicating that investors are joining this wave of trend reversal, and it seems that the turning point from bear to bull in the market has arrived.

What does this mean for the crypto market? Will the crypto market continue to be "bloodsucked" or will it usher in a general rise? Currently, Hong Kong stocks have recovered first, and the mainland securities market has continued to rise due to policy reasons, but U.S. stocks, Japanese stocks, and the cryptocurrency market have all fallen in the past two days due to capital diversion. From historical data, the huge liquidity of the U.S. interest rate cut will bring about a general economic recovery, but funds will first flow to markets with higher returns. In the initial period, the effect of the interest rate cut has not been fully radiated, and countries may take certain policy measures to compete for liquidity. The current "bloodsucking" phenomenon may just be a manifestation of the competition for liquidity between different markets before the interest rate cut effect spreads.