Date
20 September 2019
Rainy nights in Hong Kong: unpredictable weather may affect investor sentiment. Photo: AFP
Rainy nights in Hong Kong: unpredictable weather may affect investor sentiment. Photo: AFP

Weather is unpredictable, so is the market

“It’s May, it’s May, the lovely month of May!” says Queen Guenevere in Camelot. But you can’t blame those who think it’s March by the way the weather is going.

Except for the little rain, however, it’s actually quite pleasant to walk around the city with Hong Kong enjoying a favorable weather of 20 degrees Celsius, which allows us not to turn on the air-con.

How come the weather this week, which is already the start of summer in the traditional East Asian calendar, or Lixia, is colder than March and the unusually hot April?

The China Meteorological Administration, the national weather service of the People’s Republic of China, says most provinces in the mainland are experiencing weather that’s colder than the day of Lidong, the start of winter.

Like in Hong Kong, the temperature in some mainland provinces is about 20 degrees. It was 19.2 in Guangdong this morning, compared with 27.2 degrees on the first day of winter on Nov. 7th last year.

Same thing for France, which has recorded the coldest May in 50 years, thanks to a mass of polar air blowing directly from the Arctic. It was minus 10 degrees in some parts of the country.

The unusual cold weather also blew away the bull run in global markets, but that’s because US President Donald Trump announced that he would impose higher tariffs on Chinese goods from Friday. It was a shocking U-turn from his earlier remarks that had led the world to believe a trade deal with China was at hand.

Well, the two sides could still strike a deal, just as we can reasonably expect the weather would turn warmer in the run-up to summer, otherwise, we might need to put the jackets back in the closet.

But before that happens, investor sentiment, like the weather, has turned cold, knocking off a thousand points from the Hang Seng Index.

One can’t tell when the benchmark will climb back to the 30,000 level, but as the old investment axiom goes, “Sell in May and go away.”

The cold weather, however, seems to have a positive impact on the English football teams. After Liverpool trounced Barcelona, Tottenham Hotspurs won against AFC Ajax in Amsterdam and made it to the UEFA Champions League final for the first time.

It will be the first match-up of England teams since Manchester United beat Chelsea in 2008.

The final will be held in June yet, but May could extend its unpredictability into the game in Madrid. 

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CG

EJ Insight writer