(Sept. 29, 2009 - Chinavestor) As we all know, a strong market days in the U.S. makes a difference in Asia. But when it comes to Hong Kong the cliche is almost bullet proof. While the Hang Seng fell hard on Monday, Tuesday was the perfect comeback day for China stocks. The Hang Seng index advanced 424.76 points or 2.06% to 21,013.17 at the close with only one stock ending the day lower out of the 44 member index. It is a complete reversal from Monday when only one stock advanced.
But the Shanghai Composite index shed another 8.98 points or 0.33% to 2,754.54 at the close. While lending remained strong and helped financials, trading volume evaporated before the upcoming week long holiday as investors didn't want to take risk. Volume was at record lows for 2009. Low commodity prices hurt resource, energy and metal players.
Looking ahead it's early to tell what's going to happen. A slew of economic data will roll out today, starting at 9:00 A.M.
But with a strong performance of the Hang Seng Index in Hong Kong, expect Chinese ETFs - FXI, HAO, and TAO - to outperform.