This and previous notes can be found at Substack ( Asian Market Sense )
Check out ERI-C.com for your research needs.
HSI +34pts (+0.1%) 24,686 HSCEI -33pts (-0.4%) 8,795 T/O HK$137.36bn (+5.8% DoD)
HK/CHINA Connect Flows
Northbound Rmb 42,247m Sell 21,098m vs 21,149m Buy
Southbound HK$ 14,354m Sell 7,109m vs 7,245m Buy
Northbound Rmb 55,496m Sell 26,589m vs 28,907m Buy
Southbound HK$ 15,268m Sell 6,703m vs 8,566m Buy
Market opened flat but trending lower on concerns over further covid lockdowns with Germany expected to announced more measures; Travel and Leisure weak. Energy names +VE
Earnings before the bell came from Johnson Matthey, Virgin Money and United Utilities.
Telecom Italia strong, following a report suggesting U.S. private equity giant KKR is considering upping its buyout bid.
Genus weak after its trading update, which indicated that full-year profit before tax would likely be moderately lower than previous estimates.
Business Climate Nov 96.5 vs 97.7 Oct (F/cast was 96.5)
Current Conditions Nov 99 vs 100.2 Oct revised (F/cast was 99.5)
Expectations Nov 94.2 vs 95.4 Oct (F/cast was 95)
Business Confidence Nov 109 vs 107 Oct (F/cast was 105)
Climate Indicator Nov 114 vs 112 Oct revised (F/cast was 112)
CBI Industrial Trends Nov (Oct was 9, F/cast is 12)
Dow -26pts, S&P slightly -VE and NDX slightly +VE Caution ahead of big dump of data
US API Crude Oil Stock Change, MBA 30 yr Mortage Rate, Applications, Purchase Index Refinance Index and Mortgage Market Index, Durable Goods Orders, Goods Trades Balance, Wholesale Inventories, Retail Inventories, Initial Claims, 4 week Average Claims Continuing Claims, GDP (Price Index, Growth Rate, Sales) Corporate Profits, Real Consumer Spending, Core PCE, PCE Prices, New Home Sales, Personal Income & Spending, PCE Price Index, New Home Sales, Michigan Data (Sentiment, Inflation Expectations, 5 yr Inflation, Current Conditions, Consumer Expectations), EIA Crude Oil Change & Gss Report, FOMC minutes
CHINA CSI 300 closed +3pts (+0.07%) @ 4,917
CSI 300 opened higher but traded in a tight range through the morning with good support at 4,900 level. PM market rallied to 4,932 in the first hour with buying focused on liquor and banks but then sold down to close effectively flat. New Energy names weak but Metaverse names +VE along with Rare Earth names.
Government seeking to play down Peng Shuai incident
Leaders F&B, Mining and clothing
Laggards Electrical Equip, Agri, Defence
Shanghai Comp +4pts (+0.1%) @ 3,592 T/O US$68,312m (-6% DoD)
Shenzhen Comp -18pts (-0.1%) @ 14,888 T/O US$111,996m (-1% DoD)
ChiNext Comp -4pt (-0.1%) @ 3,782
Pre market opened @ 24,672 +21pts vs -95pts ADR’s traded sideways for the first 30 mins but then dipped to 24,560 level and worked better to flat at lunchtime. PM rallied to 24,851 but trended lower and then sold down to flat before ticking up into the close.
Ecommerce continued selective weakness; Meituan +VE ahead of results and Kaishou +VE after good earnings but Xiaomi weak on poor shipments data due to chip shortage. Other Tech on expectation of interest rate rises ahead. IPP’s +VE on news of intra province power trading. Alternative Energy mixed; NDRC reviewing policy to achieve carbon neutral, Solar weak as some projects said to be halted due to over capacity. Macau +VE but Education eased after recent rally except Scholar +VE on rumour of special dividend. China Property continued +VE on hints of more easing/supportive policies.
HONG KONG DATA
CHP reported 1 additional confirmed cases of covid, imported.
SHORT SELLING HSI Wednesday 22% vs 19.5% Tuesday
Top shorts Country Garden (2007) 55%, Henderson Land (12) 54%, China Res Land (1109) 41%, Citic (267) 38%, HSBC (5) 37%, Galaxy Ent (27) 36%, Hang Seng Bank (11) 36%, Ali Health (241) 36%, Sunny Optical (2382) 35%, Hengan (1044) 35%, Bud APAC (1876) 33%, Longfor (960) 32%, Baba-SW (9988) 32%, Mengniu Dairy (2319) 30%, SHKP (16) 29%, PingAn (2318) 28%, BYD (1211) 28%, CM Bank (3968) 28%, Wharf REIC (1997) 26%, Petrochina (857) 25%.
AFTER MARKET NEWS
China's Ministry of Commerce (MOC) expressed during a press conference that the trade ties between China and Hong Kong have grown to be tighter than ever, with Hong Kong remaining as one of the most important trading partners of China, reported The Paper.
YTD, China and Hong Kong have managed to overcome the negative impact wrought by the COVID-19 pandemic and realize substantial growth in trading activities. Over 10M21, the total import and export value of China and Hong Kong amounted to USD285.95 billion, up 33.5% YoY, which has sufficiently attested the close partnering relationship and the immense development potential between the two places, concluded the MOC.
The total amount of profit recorded by Chinese SOEs amounted to RMB3.83 trillion from January to October 2021, up 47.6% year-over-year and realizing an average growth of 14.1% in two years, according to data from Ministry of Finance (MOF).
XPENG-W (09868.HK), as a company focusing on global opportunities, is hoping to achieve a balanced contribution of delivery in the long-run, with half of it coming from China and the other half from foreign countries outside of China, expressed the vice president and chairman of the company, Brian Gu. He remarked that XPENG-W is planning to expand its investment in the international market in 2021 and 2022 and is expecting to enter the markets of Sweden, Denmark and the Netherlands next year.
MTR CORPORATION (00066.HK) announced the Board has re-appointed Jacob Kam as the Chief Executive Officer of the Corporation for another three-year term, with effect from 1 April 2022. Kam, who has been serving the Corporation for 26 years, was first appointed as the Chief Executive Officer in 2019, with effect from 1 April 2019, the announcement added.The White House has orchestrated a release of strategic oil reserves in coordination with China and four other nations to cool prices, reported The Paper. In this regard, Chinese Foreign Ministry Spokesperson Zhao Lijian said China will arrange a release of oil from Strategic Petroleum Reserve (SPR) according to its own actual needs, take other necessary steps to maintain market stability, and timely make announcements. As one of the world's key oil producers and consumers, China has attached great importance to international oil market stability. Beijing is willing to stay touched with all parties to sustain market balance and long-term stableness, beef up cooperation and face challenges together.
Wheelock Properties has by far sold 487 units of the MONACO ONE project located in Kai Tak, accounting for about 99% of the units offered in the phase one of the residential project and cashing in over $5 billion, said Ricky Wong, Managing Director of the group.
Wong added that the group is now conducting preparatory works for the second phase of MONACO ONE, which is expected to offer 559 units in total. The second phase of the project will likely obtain a pre-sale consent in near-term and is expected to be open for sales by early 2022, Wong expressed. Given the generally better views of the units of the second phase, Wong anticipated that the selling prices of the upcoming units may be lifted by about 10%, compared to the current average selling price of approximately $25,000 per square foot.
Futu Holdings Limited (FUTU.US) announced its results for the third quarter. Non-GAAP net income increased 58.5% year-over-year to HK$646 million. Net income increased 53.14% year-over-year to HK$615 million. Basic net income was HK$0.5 per share, or HK$4 per American Depositary Share (ADS).
Hong Kong government announced that the Chief Secretary for Administration, John Lee, led representatives of the Hong Kong Special Administrative Region to Shenzhen today (November 24) to attend the second meeting on the anti-epidemic work of the Mainland and Hong Kong tomorrow (November 25), in order to press ahead with the resumption of quarantine-free travel between the Mainland and Hong Kong in a gradual and orderly manner.Regional Markets
Market dipped initially to 7,380 level before working better to 7,425 but then sold down to 7,400 before rebounding to trade around flat to close -11pts (-0.2%) @ 7,399. Sentiment lacked direction but some interesting moves; Bapcor continued weakness after the news the CEO/Founder was leaving. Energy +VE as reserve releases seen as having minimal impact. Tech continues weakness on the expectation of rising interest rates.
Markets reopened lower Nikkei trended lower to find support around 29,200 level. Topix similar with support around 2,015.
Tech under pressure as Powell reappointed with most expecting tapering and rate hikes to be sooner than previously thought but Financials +VE on the news. Miners and energy +VE as release of strategic reserves seen as having minimal impact.
Record covid cases -VE for sentiment.
Foreigners continue to buy Tech and started buying Financials too
Local Institutions selling Tech and Games/NFT’s names.
BoK interest rate decision tomorrow.
Kospi opened higher above 3,000but trended lower for the first hour before selling down to 2,980 level and trading sideways for a couple of hours and then working better for the last hour to close -3pts (-0.1%) @ 2,994, just below the important 3,000 level for a second day.
Kosdaq followed a similar path but worked better from the low 1,003 to close +6pts (+0.6%) @ 1,020.
Opened higher and traded sideways after initial spike. Trended lower from 10am but found support around17,600 and traded sideways again before spiking to flat in the last 20 minutes but dipped to close -23pts (-0.1%) @ 17,643
T/O was US$10.5bn vs US$11.29bn Tuesday
CECC reported 5 new covid cases all imported
M2 Money Supply Oct 8.45% YoY vs 8.69% Sept
MEITUAN (03690.HK) +8.000 (+3.014%) Short selling $435.40M; Ratio 7.332% closed at $273.4, up 3%
AIA (01299.HK) +2.250 (+2.636%) Short selling $114.61M; Ratio 5.220% closed at $87.6, up 2.6%
TENCENT (00700.HK) -9.000 (-1.870%) Short selling $984.03M; Ratio 7.972% closed at $472.2, down 1.9%
HKEX (00388.HK) -4.800 (-1.048%) Short selling $247.57M; Ratio 11.286% closed at $453, down 1%
BABA (09988.HK) -1.200 (-0.902%) Short selling $856.86M; Ratio 14.489% closed at $131.8, down 0.9%
HSI & HSCEI Constituents on Move:
ALI HEALTH (00241.HK) -0.600 (-7.051%) Short selling $106.53M; Ratio 15.818% closed at $7.91, down 7.1%
XIAOMI (01810.HK) -1.440 (-6.957%) Short selling $973.61M; Ratio 12.695% closed at $19.26, down 7%
KUAISHOU-W (01024.HK) +4.950 (+5.224%) Short selling $338.63M; Ratio 4.636% closed at $99.7, up 5.2%
EVERGRANDE (03333.HK) -0.150 (-5.119%) Short selling $10.99M; Ratio 4.865% closed at $2.78, down 5.1%
CG SERVICES (06098.HK) -2.550 (-4.923%) Short selling $87.75M; Ratio 8.354% closed at $49.25, down 4.9%
XINYI SOLAR (00968.HK) -0.680 (-4.722%) Short selling $36.17M; Ratio 6.691% closed at $13.72, down 4.7%
EVERG SERVICES (06666.HK) -0.200 (-4.545%) Short selling $5.35M; Ratio 2.640% closed at $4.2, down 4.5%
ENN ENERGY (02688.HK) +6.400 (+4.292%) Short selling $114.46M; Ratio 10.640% closed at $155.5, up 4.3%
SUNAC (01918.HK) -0.600 (-3.995%) Short selling $46.82M; Ratio 6.569% closed at $14.42, down 4%
GEELY AUTO (00175.HK) -0.950 (-3.612%) Short selling $198.71M; Ratio 9.979% closed at $25.35, down 3.6%
HSMI & HSSI Constituents on Move:
SCHOLAR EDU (01769.HK) +0.490 (+27.072%) Short selling $696.56K; Ratio 0.523% closed at $2.3, up 27.1%
ZHONGYU GAS (03633.HK) +0.070 (+0.917%) Short selling $15.29K; Ratio 0.109% closed at $7.7, up 0.9%, hitting new high