Oct 20 HK rallies but China Wanes


20 Oct

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HSI +349pts (+1.4%) 26,136 HSCEI +140pts (+1.5%) 9,277 T/O HK$156.59bn (+29.4% DoD)  

Asia
Opened higher despite the IMF downgrade of its growth forecast to 6.5% from 7.6% its April forecast. But turned weaker after disappointing Chinese data and an eruption in Japan. Energy weak as China says it will intervene on coal.

Europe
Market opened
Caution ahead of data and earnings from Carrefour, Atos, Metro, Sartorious, AkzoNobel, Roche, Nestle, Antofagasta and Metro Bank.
Eurozone
Current Account Aug €17.6B vs  €30.2B Jul (F/cast was €25.1B)
Core Inflation Sept 1.9% vs 1.6% Aug (F/cast was 1.9%)
Inflation Sept +3.4% YoY vs +3% Aug (F/cast was +3.4%)
Inflation Sept +0.5% MoM vs +0.4% Aug (F/cast was +0.5%)
Germany
PPI Sept +2.3% MoM vs +1.5% Aug (F/cast was +0.8%)
PPI Sept +14.2% YoY vs +12% Aug (F/cast was +12.5%)
UK
Inflation Rate Sept +3.1% YoY vs +3.2% Aug (F/cast was +3.2%)
Inflation Rate Sept +0.3% MoM vs +0.7% Aug (F/cast was +0.4%)
Core Inflation Sept +2.9% YoY vs +3.1% Aug (F/cast was +2.9%)
Core Inflation Sept +0.4% MoM vs +0.7% Aug (F/cast was +0.3%)
PPI Core Output Sept +5.9% YoY vs +5.4% Aug revised (F/cast was +5.7%)
PPI Core Output Sept +0.5% MoM vs +0.9% Aug revised (F/cast was +0.4%)
PPI Input Sept 11.4% YoY vs 11.2% Aug revised (consensus +11.6%)
PPI Input Sept +0.4% MoM vs +0.5% Aug revised (consensus was 1%)
PPI Output Sept +6.7% YoY vs +6% Aug revised (F/cast was +6.7%)
PPI Output Sept +0.5% MoM vs +0.7% Aug (F/cast was +0.5%)
Retail Price Index Sept +4.9% YoY vs +4.8% Aug (F/cast was +4.9% )
Retail Price Index Sept +0.4% MoM vs +0.6% Aug (F/cast was +0.4%)
US Futures
Opened Dow +19pts S&P +0.1% and NDX flat
Ahead
Earnings: Tesla, Verizon, IBM, Lam Research, CSX, Baker Hughes, Abbott Labs, Nasdaq, Biogen, Knight-Swift Transportation, Canadian Pacific Railway, Northern Trust, Tenet Healthcare, PPG Industries, SLM
Fed Speakers: Bosti, Evans, Bullard and Daly
Data Beige book, MBA Mortgage Applications and 30 yr rate, EIA Oil report.

CHINA CSI 300 closed -13pts (-0.3%) @ 4,910
CSI 300 opened higher and tested to 4,944 in early trades but then reversed and sold down to 4,900 before bouncing back to flat at lunchtime. PM saw the market trend lower in choppy trading with support around the 4,910 level.
PBOC injected 100bn yuan today having previously been withdrawing liquidity as House prices fell and there is news that land sales have fallen too as developers hold onto cash which will cause funding issues for local governments.

Shanghai Comp -6pts (-0.2%) @ 3,587 T/O US$65,158m (+2% DoD)
Shenzhen Comp -48pts (-0.3%) @ 14,452 T/O US$89,049m (+7% DoD)
ChiNext Comp -9pts (-0.3%) @ 3,493

CHINA DATA
Loan Prime Rate 1yr 3.85% unch and 5yr +4.65% unch; as expected
House Price Index Sept 3.8% YoY vs 4.2% Aug (F/cast was 4%)
Monthly Prices in tier-1 Chinese cities were flattish MoM in September, against a 0.3% growth in August,  Second-hand home prices fell 0.4% MoM in tier-1 cities. In tier 2 New commodity home prices were flattish MoM and down 0.2% In tier 3  -0.2% MoM   Second-hand home prices sagged 0.1% MoM in tier-2 cities and -0.2% MoM in tier-3 cities.
Yearly Prices of newly-built commodity homes and second-hand homes in tier-1 Chinese cities rose 5.3% YoY and 7.7% YoY in September, down 0.4 ppts and 1.4 ppts from August's.
New commodity home and second-hand home prices added 4.1% YoY and 3.0% YoY in tier-2 cities, down 0.3 ppts and 0.2 ppts from the prior month.
New commodity home and second-hand home prices climbed 2.3% YoY and 1.4% YoY in tier-3 cities, both falling 0.5 ppts from the prior month.
Major Cities
Newly-built commodity home prices in Beijing were flattish MoM and up 4.5% YoY in September.
Shanghai's new commodity home prices added 0.2% MoM and 4% YoY that month.
Guangzhou's new commodity home prices fell 0.1% MoM but climbed 9% YoY.
Shenzhen's new commodity home prices rose 0.2% MoM and 3.8% YoY.

HONG KONG 
Pre market opened @ 26,074 +287pts vs +137pts ADR’s
Initial weakness but found support as it approached 25,900 and then worked higher to test 26,200 pre lunch but failed to break out and eased back to 26,100. PM the market traded sideways around that level.
Coal names weak on news China would intervene. But Tech seeing a strong rally as Baba announced new chip for data centres. Macau names +VE on broker upgrades. WH Group weak on news hog prices to remain low.

HONG KONG DATA
Hong Kong reported 4 imported covid cases
Hong Kong's overall market recruitment burgeoned 78% yearly in the first three quarters, according to JobsDB's latest job advertisement figures. 
Of which, the top-four service industries (i.e. retail +108%, catering +183%, beauty +100% and hospitality sectors +187%)

SHORT SELLING HSI Wednesday  21.2%  vs 19.1% Tuesday
Top shorts 
Henderson Land (12) 58%, CM Bank (3968) 41%, Sunny Optical (2382) 37%, Country Garden (2007) 36%, Hengan (1044) 34%, China Life (2628) 34%, Mengniu Dairy (2319) 34%, Baba (9988) 32%, ICBC (1398) 31%, Shenzhou (2313) 28%, Xinyi Solar (968) 28%, Bud Apac (1876) 28%, Petrochina (857) 27%, Wharf REIC (1997) 27%,  CK Asset (1113) 26%,  AIA (1299) 26%, PingAn (2318) 25%, Bank of China (3988) 25%.

AFTER MARKET NEWS
The Hong Kong Monetary Authority (HKMA) announced the composite interest rate at the end of September 2021.
The composite interest rate, which is a measure of the average cost of funds of banks, remained unchanged at 0.19 per cent at the end of September 2021 as the weighted funding cost for deposits was steady during the month.

Replying media inquiries, Huawei said the rumor about the company forming JV with Volkswagen Group for the project to develop autonomous driving technology was untrue.

Peng Huagang, Secretary General of the State-owned Assets Supervision and Administration Commission (SASAC), expressed that the commission will endeavor to implement the relevant requirements outlined in the previously released opinions on propelling the optimization of state-owned economic layout and structural adjustment, while guiding SOEs to carry out reformation works with a market-driven principle.  China will likewise actively push for the professionalization and consolidations for sectors such as rare-earths and logistics, with the aim to forge world-class corporates with global competitiveness through optimized resources allocation, Peng added.

Regional Markets
Australia
Market opened higher around 7,420 in early trades following the +VE moves in the US and then worked better to test 7,450 late morning but then drifted slowly lower, to close  +39pts (+0.5%) @ 7,414
Material stocks leading although selling down with Rio selling down ahead of strategy day in UK.
Energy names are weaker with Whitehaven Coal -7.7% as China says it will intervene to curb the surge in coal prices. Beach Energy -3.7% weak after Q1 sales volume and revenue missed.
Worley +7.7% after winning a operate/manage contract for 8 pacific hydro wind farms. Kogan +6.7% after its Q1 business update. But Flight Centre Travel -4.8% after saying it was unable to give forward guidance.
BHP +1% has offered C75 cents per share for Canadian nickel miner Noront Resources, out-bidding Andrew Forrest’s Wyloo Metals offer of C70 cents per share.
Data
Leading Index Sept -0.02% MoM vs -0.27% Aug revised (F/cast was -0.1%)
Japan
Nikkei opened higher around 29,400 and tested up to 29,500 mid morning after mixed trade data but eased back to 29,400 level and then sold down around 11.45am on news Mount Aso had erupted.
PM the market opened around 29,300 and trading sideways initally but then dipped to test Tuesday’s close but bounced to close +40pts (+0.1%) @ 29,256
Topix trading in a similar pattern to close +1pts (flat) @ 2,028
News blackout ahead of earnings getting underway added to the market caution today. Transport +VE ahead of ‘Go to travel’ restarting in Nov. Financial & Brokers +VE. Tech mixed after Economic Security minister comments and Micron news. Softbank +VE as Chinese Tech rebounds and talks with Ampere Computing. Kawasaki -9% further selling after Washington derailment.
Data pre market
Balance of Trade Sept ¥-622.8B vs ¥-637.2B Aug revised (F/cast was ¥-500B)
Exports Sept 13% vs 26.2% Aug (F/cast was 12%)
Imports Sept 38.6% vs 44.7% Aug (F/cast was 34%)
S Korea 
Foreigner/Local Insts turn net sellers on weak China data but T/O slightly better but still light.
Entertainment plays Kakao and Naver +VE after Netflix subscriber growth also content providers +VE
Laggards Steel, Battery, Machinery, Ships.
Kospi opened higher but trended lower and sold down into the red late morning to 3,016 before then trading 3,020/26 but then sold down to 3,013 before a bounce to close -16pts (-0.5%) @ 3,013
Kosdaq traded in a similar pattern and closed -4pts (-0.4%) @ 1,006
Announced 1,571 new covid cases and 66.7% of population vaccinated
Taiwan 
Taiex opened higher and tested to 16, 975 in early trades but 17k is resistance and the market then trended lower and traded around flat dopped to 16,855 but then bounced to close -13pts (-0.1%) @ 16,888
Tech seeing some interest but TSMC failed to hold above $600 level again. EV +VE after Hon Hai’s model debut. Shipping also +VE on news of extended delays at US ports. Some caution ahead of Export data due after market
T/O Wednesday US$9.52bn vs US$9.5bn Tuesday
After market
Export Orders Sept +25.7% YoY vs 17.6% Aug (F/cast was 17.5%)


HK/CHINA Connect Flows
Shanghai
Northbound Rmb 45,739m Sell 22,054m vs 23,685m Buy
Southbound HK$ 16,712m Sell 8,181m vs 8,531m Buy
Shenzhen
Northbound Rmb 56,167m Sell 26,859m vs 29,307m Buy
Southbound HK$ 14,261m Sell   5,348m vs   8,913m Buy

Movers
Active Heavyweights
BABA (09988.HK)  +11.000 (+6.675%)    Short selling $2.21B; Ratio 30.573%    closed at $175.8, up 6.7%
MEITUAN (03690.HK) +8.200 (+2.871%) Short selling $1.54B; Ratio 20.259% closed at $293.8, up 2.9%
TENCENT (00700.HK) +10.500 (+2.104%) Short selling $1.73B; Ratio 16.281% closed at $509.5, up 2.1%
HKEX (00388.HK) +8.000 (+1.657%) Short selling $190.64M; Ratio 19.880% closed at $490.8, up 1.7%
AIA (01299.HK) +1.250 (+1.397%) Short selling $294.30M; Ratio 30.029% closed at $90.7, up 1.4%
PING AN (02318.HK) +0.350 (+0.603%) Short selling $161.54M; Ratio 20.302% closed at $58.35, up 0.6%

HSI & HSCEI Constituents on Move:
ALI HEALTH (00241.HK)  +1.500 (+13.489%)    Short selling $58.99M; Ratio 12.299%    closed at $12.62, up 13.5%
JD HEALTH (06618.HK) +4.850 (+6.519%) Short selling $29.90M; Ratio 5.072% closed at $79.25, up 6.5%
CG SERVICES (06098.HK) +3.050 (+5.004%) Short selling $61.18M; Ratio 19.964% closed at $64, up 5%
GEELY AUTO (00175.HK) +1.250 (+4.931%) Short selling $168.34M; Ratio 16.830% closed at $26.6, up 4.9%
BIDU-SW (09888.HK) +7.800 (+4.607%) Short selling $159.58M; Ratio 23.742% closed at $177.1, up 4.6%
KUAISHOU-W (01024.HK) +3.850 (+4.278%) Short selling $248.57M; Ratio 7.381% closed at $93.85, up 4.3%
SANDS CHINA LTD (01928.HK) +0.700 (+4.089%) Short selling $19.46M; Ratio 15.085% closed at $17.82, up 4.1%
GALAXY ENT (00027.HK) +1.350 (+3.277%) Short selling $33.19M; Ratio 7.869% closed at $42.55, up 3.3%

HSMI & HSSI Constituents on Move:

POWERLONG CM (09909.HK) +2.100 (+13.852%) Short selling $1.03M; Ratio 3.307% closed at $17.26, up 13.9%
SHIMAO SERVICES (00873.HK) -1.820 (-10.820%) Short selling $110.99M; Ratio 5.090% closed at $15, down 10.8%
YANZHOU COAL (01171.HK) -1.620 (-10.672%) Short selling $293.84M; Ratio 43.082% closed at $13.56, down 10.7%
CANVEST ENV (01381.HK) +0.090 (+1.871%) Short selling $311.72K; Ratio 8.620% closed at $4.9, up 1.9%, hitting new high
ZHONGYU GAS (03633.HK)  +0.080 (+1.110%)    Short selling $436.63K; Ratio 2.787%    closed at $7.29, up 1.1%, hitting new high


Market News
BABA-SW (09988.HK) officially switched on the global shopping carnival "Double 11" on Tmall today (20th), 
ambitiously advocating inclusiveness and sustainability.  BABA-SW described the scale of "Double 11" this year is the greatest on record, luring 290,000 brands to join altogether, also setting an all-time high.

XPENG-W (09868.HK)   announced on its official WeChat that XPENG P5, the world's first mass-produced LIDAR smart vehicle, 
was produced at Zhaoqing factory in bulk swimmingly, projected to be delivered from the end of October.

China's Ministry of Finance (MOF) has successfully issued USD4 billion sovereign bonds in Hong Kong yesterday (19th), which have tenures of 3, 5, 10 and 30 years, reported cs.com. The total subscription volume of said bond issuance amounted to USD24 billion, representing an oversubscription of 5x, the report added.

BABA-SW (09988.HK)'s Alibaba Cloud unveiled its plan to set up two new data centers in South Korea and Thailand to assist local enterprises in their digital innovation journey.  Local businesses in South Korea of all sizes will be able to deploy mission-critical workloads while enjoying more reliable and secure cloud services with lower latency, said Selina Yuan, General Manager of International Business, Alibaba Cloud Intelligence.  While for Thailand, the data center will offer products and solutions that are in line with Thailand 4.0 - the Thai government’s 20-year strategy, she added.

Alibaba Cloud, the digital technology and intelligence backbone of BABA-SW (09988.HK), today unveiled at Apsara Conference 2021 Premium DingTalk for Sports Games, a digital solution aimed at streamlining the organization and communications for large-scale sports events. The new solution will be used for the 2022 Asian Games, to be held in Hangzhou next September, serving over 100,000 participants from across the world.

The global smartphone shipment volume slipped 6% YoY in 3Q21 as the suppliers struggled to meet the market demand amid component shortages, reported Canalys.
Samsung continued to lead the market with the largest smartphone shipment volume around the world, and market share amounting to 23% in 3Q21, flattish YoY. Apple (AAPL.US), on the other hand, surpassed XIAOMI-W (01810.HK) and regained the second place in shipment volume, with its market share hiking to 15% in 3Q21 from 12% in 3Q20. The market share of XIAOMI-W was maintained at 14%, while vivo and OPPO continued to be ranked as fourth and fifth, with a market share of 10% each, according to data from Canalys.

The Chinese government has required McDonald’s to expand the digital RMB payment system across the entire country before the Beijing Winter Olympic Games which will take place in February next year, reported Financial Times. Three people familiar with the matter revealed that China is now propelling some U.S. companies to install a system that would enable customers to purchase products with digital RMB during the Olympic Games.

JLL released the latest Hong Kong Property Market Monitor report, stating that, in September, the office rents in Central stretched 0.6% MoM to $90.3 per square feet, achieving a two-month rising streak and recouping the rent level of above $90. Said increase in the office rents signaled the gradual recovery of the market, mainly driven by the market demand for office space with higher quality, JLL analyzed.

U.S. chip supplier Micron Technology, Inc. (MU.US)  is planning to build a new chip plant in Hiroshima, Japan for JPY800 billion (approximately USD6.99 billion), reported Nikkan Kogyo newspaper.  The new factory will likely focus on manufacturing DRAM memory chips which are widely used in data centers, and is predicted to commence operation in 2024, the report added.

BYD COMPANY (01211.HK)  announced that it has recently delivered the first batch of 10 pure electric articulated vehicles, R18, to the Yichang public transport group, which has been swiftly integrated into the high-speed public transport operation of Yichang city.

The debt crisis of Chinese property developers escalates. SINIC HOLDINGS (02103.HK) becomes another Chinese real estate company that reports default, Bloomberg said. On another note, investors are still awaiting EVERGRANDE (03333.HK)'s announcement on whether it is able to repay the USD bond coupons that are unsettled in due time.
S&P Global Ratings had earlier downgraded SINIC HOLDINGS' credit rating to Selective Default from CC, citing the company missed the principal and interest payment of US$250 million offshore bonds due 18 October. Moreover, the company was also expected to trigger cross default on its unsettled repayment. As revealed by Bloomberg data, SINIC HOLDINGS has a balance of US$694 million in USD debt.

Overnight HIBOR last posted at 0.03667%, according to HKAB. Meanwhile, the 1-Month HIBOR related to mortgage rate last stood at 0.06643%, marking a 1-month high.

Edward Yau, Hong Kong's Secretary for Commerce and Economic Development, pointed out the resilience displayed by Hong Kong's trade performance despite the COVID-19 epidemic. Benefitting from the stable supply chains maintained through effective control of the epidemic in the Mainland, the value of Hong Kong's total merchandise trade has rebounded since the fourth quarter of last year.  Furthermore, according to the results of two latest annual surveys conducted by Invest Hong Kong and the Census and Statistics Department, the number of business operations in Hong Kong with parent companies overseas or in the Mainland reached 9,049 and the number of start-ups in Hong Kong was 3,755 in 2021, both reaching record highs. These figures demonstrate fully that despite the impact of COVID-19 epidemic, Hong Kong remains an ideal place for companies to set up or expand their businesses, and for start-ups to flourish, Yau remarked.

KUAISHOU-W (01024.HK) tracked 230 million short drama daily active users as of October 2021, with the size of skit creators rising by over 32%, Chinese media citing a person in charge of the playlet arm. The total revenue of skit creators have exceeded RMB1 billion.

Alibaba Cloud, the cloud computing service platform under BABA-SW (09988.HK), signed a framework cooperation agreement with Guangxi Liuzhou Iron and Steel Group earlier. 
Pursuant to which, both sides will collaborate to propel Liuzhou Iron and Steel's digital transformation and upgrade for an in-depth integration between digital technology and traditional industries.

China approved seven fixed asset investment projects in September, with the total investment amounting to RMB75.2 billion, a spokesman of the National Development and Reform Commission (NDRC) revealed.
Over the first three quarters of this year, 66 fixed asset investment projects were approved, involving a total investment of RMB480.4 billion, the spokesman added.

BABA-SW (09988.HK)'s chairman and CEO, Daniel Zhang, expressed during a speech at a forum yesterday (19th) that, the company aspires to take up more social responsibility in fundamental research and to enable more people to benefit from technological advancement, reported China Daily.  Previously launching its first self-developed CPU chip "Yitian 710", Zhang remarked that BABA-SW is endeavoring to integrate itself into China's technological development layout and that it is committed to developing technology that is open and socially benefitting.

XPENG-W (09868.HK)  (XPEV.US)  CEO He Xiaopeng predicted during the Reuters Events Automotive Summit that NEVs will account for more than 35% of the first-hand vehicle sales in China by 2025.  He added that the overall NEV sales this year is slightly beating estimate, and that he was surprised by the sharp increase in the sales of hybrid vehicles and mini EVs.


Pre Market News 
MEITUAN-W (03690.HK)  has recently established a fragrant spicy pot brand called "Chanali" in Zhengzhou and Beijing to explore the model of self-operated restaurant chain, reported Chinese media.

China Foreign Exchange Trade System announced on Wednesday (20th) that the central parity of RMB/ USD rose 238 bps from the last trading day to 6.4069, the highest level since mid-June.

KUAISHOU-W (01024.HK)  intends to integrate its overseas business, according to Chinese media. The Group's internationalization division had in recent month initiated product merger, under which three independent Apps - Kwai Middle East, Kwai Latin America and Snack Video (targeted Southeast Asia) - were rebranded as one single product under Kwai.

SHIMAO SERVICES (00873.HK) announced a top-up placing of existing shares, involving 115 million existing shares, representing about 4.64% of the issued share capital of the company as enlarged by the subscription. The placing price is HK$15.18 per share and represents a discount of approximately 9.75% to the closing price of HK$16.82 per share as quoted on the Stock Exchange on 19 October 2021, the last trading day.  The net proceeds to be received by the company from the subscription are estimated to be approximately HK$1.735 billion. The company intends to apply such net proceeds for potential mergers and acquisitions, business expansion, general working capital and general corporate uses, the announcement added.

International Monetary Fund (IMF) lowered the economic growth forecast of Asia for this year from 7.6% to 6.5%, mainly as a result of the impeded consumption and factory production due to the COVID-19 outbreak. The IMF, however, lifted the economic growth forecast for next year from 5.3% to 5.7%, to reflect the gradually increasing vaccination rates.  IMF remarked that the economic growth of China this year is predicted to be 8%, which will then slow to 5.6% next year. With the resurgence of the COVID-19 outbreak, combined with fiscal tightening, which weighs on public consumption, China's recovery from the pandemic impact will remain imbalanced, IMF analyzed.

Hong Kong Monetary Authority (HKMA)'s spokesman expressed that the operation of "Cross-boundary Wealth Management Connect" (WMC) has officially commenced yesterday (19th), with 18 Hong Kong banks, along with their partnering banks in China, offering the services.
The operation of the WMC scheme ran well for the first day. As of 12 pm yesterday, the participating Hong Kong banks have set up a total of over 200 investment and wire transfer accounts for Chinese and Hong Kong investors alike, so as to facilitate them to engage in southbound and northbound investment, the spokesman added.

CHINA EDU GROUP (00839.HK) announced that the company has proposed a top-up placing of existing shares, involving 78 million shares, representing approximately 3.26% of the company’s issued share capital as enlarged by the subscription, at a placing price of HK$15.1 per share, which translates into a discount of approximately 9.36% to the closing price of HK$16.66 per share as quoted on the Stock Exchange on 19 October 2021.
The net proceeds from the subscription are estimated to be approximately HK$1.17 billion net of related costs, professional fees and out-of-pocket expenses. The company intends to use the net proceeds from the subscription for potential acquisitions in the modern-vocational education space, the announcement added.

The Draft Amendment to the Anti-Monopoly Law of the PRC was submitted to the 31st session of the Standing Committee of the 13th National People's Congress (NPCSC) for first reading yesterday (19 October). The amendment upholds regulation on par with development, further optimizing relevant antitrust systems with a pivot toward salient problems regarding law implementation.China's smartphone shipment  volume in September 2021 amounted to 21.44 million units, down 8.1% YoY, according to data from the China Academy of Information and Communications Technology (CAICT). The shipment volume of 5G smartphones, on the other hand, stretched 8.1% YoY to 15.118 million units, representing 70.5% of the entire shipment volume of said period.

The Cyberspace Administration of China (CAC) convened a national video work conference on 18 October to launch special rectifying actions against chaotic internet user account operations, learnt Xinhua.
The rectification should center on five types of chaotic account operations, including the "reincarnation" of illegal and non-compliant accounts, the meeting emphasized.

China is expected to further unleash the coal production capacity in a bid to sturdily increase the output, striving to achieve daily output at above 12 million tons and guide the coal prices back to reasonable level, said the responsible person of National Development and Reform Commission (NDRC) yesterday (19th) at a seminar.  Meanwhile, the Chinese authority is also expected to investigate on abnormal transactions and malicious behaviors on the coal market. On the other hand, NDRC joined forces with several coal industrial associations to consider measures on coal price intervention in legal manner.

Chinese President Xi Jinping expressed that the benign development of the digital economy is beneficial to the construction of a modernized economic system in China, reported Xinhua News Agency.
With its innovative, highly penetrative and wide-covering properties, the digital economy can serve as a pillar to improve the traditional industries while driving the development of a modernized economic system, Xi added. The president remarked that China will fully support the development of the software sector by propelling the innovation of key software technologies, while deepening the inter-sector integration between segments such as internet, big data and artificial intelligence.

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