Fulbright Securities Expects Hong Kong Markets To Fall This Week

The Hang Seng index lost 652 points for the week. The index fell below 27000 points and the 100-day moving average. Some feared the bear market has already started. Over last Friday night, American markets fell sharply. New York Times reported that Merrill Lynch would report US$15 billion in subprime mortgage losses, much larger than reported earlier.

Dow Jones lost a whopping 246 points. The market reported that Citigroup would received capital injection from the China Development Bank to the amount of US$9 billion. US Secretary of Treasury Paulson was considering ways to save the credit market. A bigger interest rate cut is expected later in the month.

Hong Kong Market This Week

We expect the Hong Kong market to follow overseas markets and fall this week. 26000 is the support level.

Today's Recommendations on Asian Stocks from Fulbright Securities

MTR Corporation (0066) Share price has performed better than the market since its takeover of KCR late last year. Share price reached a high of $36 before retreating. There is support at the $30 level. It is a safe stock in times of market turmoil.

Buy $30.00 Target $36.00, Cut loss $28.00

Esprit (0330) Share price crashed last week and fell below $100. The American fund Capital went bargain hunting. The Group will report interim results soon. 35% rise in interim profit is expected. Share price will rebound.

Buy $96.00 Target $105.00 Cut loss $90.00

Lun Sheung Nim and his associates do not own the above-mentioned shares.

Fulbright Securities Limited