23 July 2019

Eric Lui

Hong Kong Economic Journal chief economist and strategist
  • Hong Kong, the world's most overvalued housing market, saw home prices post their first dip in 29 months in August. Photo: HKEJ

    How far will Hong Kong housing prices fall?

    - Oct 26, 2018 12:59pm
    Two months ago, I presented several indicators that Hong Kong’s housing market is weakening, and that the secondary housing market is heading toward a prolonged correction. Official data shows that the city’s private housing price index has ended a...
  • A weaker yuan bodes ill for earnings of many listed companies in Hong Kong. Photo: Reuters

    HK equities to see more downside as yuan weakens

    - Oct 12, 2018 10:53am
    The People’s Bank of China announced last Sunday that it was cutting the reserve requirement ratio (RRR) for banks, the fourth such move this year. It remains to be seen whether the easing move will help...
  • If things turn worse in the US-China trade row, the Hong Kong stock market could remain subdued for a longer period. Photo: Bloomberg

    HK equities: How long will the weakness last?

    - Sep 21, 2018 11:22am
    The Hang Seng Index hit a record high of 33,484 points on January 29, and then tumbled 20 percent from its peak for the first time on September 7. Technically speaking it has already entered the...
  • Corporate earnings slowdown, amid an escalating US-China trade row, could provide a trigger for the next downturn in the Hong Kong stock market, some observers say. Photo: Reuters

    HK equities earnings outlook turns negative

    - Sep 14, 2018 11:19am
    A majority of the listed entities in Hong Kong have completed their interim results announcements as of now. The results show that the firms’ sales revenue was up 8.87 percent on average in the first six...
  • Various indicators suggest that the secondary home market is moving into a consolidation period. Photo: Reuters

    Hong Kong housing market shows signs of weakening

    - Aug 31, 2018 12:25pm
    The Hang Seng Index has been heading south since hitting a peak of 33,484 points on Jan. 29. It tumbled to a low of 26,871 points on Aug. 16, down 19.7 percent from the peak. However, secondary...
  • A strong dollar increases the debt burden of emerging markets and leads to capital outflow from these markets. Photo: Reuters

    Emerging markets face mounting pressure amid rising rates

    - Aug 17, 2018 10:34am
    The Turkish lira has slumped in recent days, sending ripples across other emerging market currencies and stoking fears of another financial crisis. To gauge whether the recent turmoil could develop into a full-blown crisis, let’s take...
  • A weaker renminbi will affect the bottom line of many Hong Kong-listed companies, which generate most of their revenue from mainland China. Photo: Xinhua

    Dollar trend, US-China trade talks key to HK equity outlook

    - Jun 29, 2018 12:03pm
    The Hang Seng Index has tumbled below the 250-day moving average and hit a year’s low of 28,342 points. The index has lost over 15 percent from its peak level so far. Currently, the Hong Kong market...
  • A strong dollar plus rising US rates would put a heavy burden on emerging economies and threaten their financial safety. Photo: Bloomberg

    A stronger dollar could trigger the next financial crisis

    - May 18, 2018 1:49pm
    Let’s revisit how the Hong Kong market collapsed in the second quarter of 2015. The Hang Seng Index slumped as much as 36 percent to 18,278 points on Feb. 12, 2016, from a high of 28,588...
  • Investors are supposed to do well by owning stocks from the beginning November to the end of April, then parking the money in money market funds, and repeating the pattern in the following year. Photo: Reuters

    Does ‘sell in May and go away’ work?

    - May 11, 2018 10:41am
    At around this time of the year, a lot of space in financial news pages is typically devoted to the seasonal pattern of sluggish performance in May and June and a rebound that follows in July....
  • Stock market investors will watch closely the pace and scale of US bond yield rebound. Photo: Reuters

    Will rising US Treasury yield hurt the equity market?

    - Apr 27, 2018 9:44am
    The 10-year US treasury yield hit the key psychological level of 3 percent on Tuesday for the first time in four years. Billionaire bond investor Jeffrey Gundlach once said that if the 10-year yield does crack...
  • Hong Kong has seen enhanced market volatility this year. Photo: Reuters

    Hong Kong equities: earnings gauges point to more upside

    - Apr 20, 2018 3:09pm
    Global stock markets have been extremely volatile this year. The looming trade war between the United States and China, the Syria geopolitical crisis and other events all have contributed to enhanced market volatility. A measure of...
  • A strategy that combines market momentum and fundamental value in stock selection may work better in a volatile market. Photo: Reuters

    A strategy that combines momentum and value investing

    - Apr 13, 2018 11:42am
    My two momentum-based mock portfolios have underperformed the Tracker Fund of Hong Kong (02800.HK) in the first quarter due to an extremely volatile market. Amid the market turbulence, many stocks in the two momentum-investing portfolios triggered...
  • Hong Kong stocks are expected to stabilize following the recent steep market correction, say some observers. Photo: Reuters

    Where is the Hong Kong market heading?

    - Feb 20, 2018 1:27pm
    The Hang Seng Index fell back sharply after hitting a peak of 33,484 points on January 29. In this pullback, the benchmark slumped up to 4,355 points or 13 percent in two weeks. During the setback,...
  • Rate hikes are unlikely to pose too much threat to the stock market, given that the current rates remain extremely low. Photo: Reuters

    Is the equity bull market over?

    - Feb 9, 2018 2:01pm
    The US stock market has suffered a sudden crash over the last few days. The biggest question now is whether the bull market cycle has already come to an end. The Dow Jones Industrial Average has...
  • The Federal Reserve may turn more hawkish and speed up the rate hikes to prevent economic overheating. Photo: Reuters

    Fed may hike rates four times this year on rising inflation

    - Feb 2, 2018 1:14pm
    Based on Fed fund futures, the market consensus is that the Federal Reserve will hike rates three times this year by 0.25 percent each time. But I personally believe that the market may have underestimated the...
  • The Hang Seng Index has rallied more than 3,000 points or 10.2 percent in the first 17 days of this year.  Photo: Reuters

    Are we seeing the last leg of the stock market rally?

    - Jan 26, 2018 11:11am
    The Hang Seng Index has been performing extremely well since the start of the year. The huge gains have surprised many investors. A number of indicators suggest that the Hong Kong market is already in the...
  • Momentum investing may continue to work well in Hong Kong this year, given that the market rally is still led by a small group of stocks. Photo: Bloomberg

    Strong counters to continue outperforming this year

    - Jan 12, 2018 12:12pm
    I had recommended two momentum investing portfolios in the middle of last year based on changing market circumstances. Both portfolios have outperformed the market by wide margin, generating returns of 118.4 percent and 75.9 percent compared...
  • The US equity market is expected to go up further next year thanks to rising corporate earnings and tax reform. Photo: Reuters

    Reality check for my 2017 forecasts

    - Dec 29, 2017 4:28pm
    It’s time to check how my 10 forecasts for this year worked out. 1. Global economic growth to pick up. Correct. The world’s major economies have maintained their growth momentum over the last 12 months, and...
  • US markets may climb to new highs next year, providing momentum to other bourses, including Hong Kong. Photo: Reuters

    2018 outlook: Equities to hit new high, property under pressure

    - Dec 22, 2017 12:31pm
    After a strong rally this year, the Hang Seng Index is likely to sustain the strength and hit a record level in 2018. Supporting the bullish outlook is the recovery momentum of the global economy and...
  • The dollar index saw a sharp pullback this year. But as the US economy is expected to maintain its strength in 2018, and interest rates will go up further, the US dollar should move higher next year. Photo: Reuters

    US dollar may stage a comeback next year

    - Dec 15, 2017 9:06am
    This is the second part of my 2018 forecast series. Basically, I see a stronger greenback, rising global inflation and the bull market of US Treasuries coming to an end. Over last two years or so, the...

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