Hong Kong shares are likely to continue their rebound next week as oil prices are expected to fall further after hitting record high levels in recent weeks, dealers said. For the week ending July 18, the benchmark Hang Seng Index closed down 310.36 points, at 21,874.19.
Francis Lun, a general manager with Fulbright Securities, told AFP that the market would likely be led by the recovery of financial stocks rather than investors' optimism in the run up to the Beijing Olympics. "Just look at the banks this week. They took charge and led the equity markets in Hong Kong as well as around the world," he said.
Lun said he expected crude oil prices would continue to fall. "I believe the oil prices have finally reached the trigger point. The prices can't go any further because if they do, the global economy will collapse," he said.
He added airline and transport stocks would likely surge due to crude price fall. The analyst told Dow Jones Newswires that the recovery was not "a dead cat bounce". "I believe such gains are sustainable as global inflation takes a breather from the receding oil prices," he said.
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