HK/CHINA WRAP HK weak on placements worries as China Gas places too after market

21 Apr

HSI -514pts (-1.8%) 28,622 HSCEI -197ts (-1.8%) 10,889  T/O HK$154.35bn (+7% DoD excluding yesterdays placement 

Markets opened higher and trading largely sideways. Good trading update from Heineken +VE
ASML strong to lead the Stoxx 600 after the company beat first-quarter profit expectations. But oil storage firm Vopak weak to the bottom of the index after missing earnings forecasts.Other Earnings due from, AkzoNobel, Randstad and Roche are among the companies reporting
Inflation Rate Mar+0.7% YoY vs +0.4% Feb (F/cast was+0.8%)
Inflation Rate Mar +0.3% MoM vs +0.1% Feb (F/cast was +0.3%)
Core Inflation Rate Mar +1.1% YoY vs +0.9% Feb (F/cast was +1%)
Core Inflation Rate Mar +0.4% MoM vs 0% Feb (F/cast was +0.3%)
PPI Output Mar +1.9% YoY vs +0.9% Feb (F/cast was +1.6%)
PPI Output Mar +0.5% MoM vs +0.7% Feb revised (F/cast was +0.2%)
PPI Core Output Mar +0.4% MoM vs +0.3% Feb revised
PPI Core Output Mar +1.7% vs +1.7% Feb revised
PPI Input Mar +5.9% YoY vs +3.3% Feb revised (Consensus was +4.4% )
PPI Input Mar +1.3% MoM vs +0.9% Feb revised (Consensus was +0.6% )
Retail Price Index Mar +0.3% MoM vs +0.5% Feb (F/cast was +0.3%)
Retail Price Index Mar v+1.5% YoY vs +1.4% Feb (F/cast was +1.5%)  

US Futures 
Opened in Asian time Dow flat, S&P -0.1%, NDX -0.4% , Dow still flat S&P slightly higher and NDX -0.1% with Netflix weak after disappointing subscriber numbers.
The U.S. will be driven into national security crisis given a lack of semiconductor output, as U.S. Commerce Secretary Gina Raimondo told senators in a hearing on the infrastructure bill. There is a crisis in America's supply chain as the country fully depends on China and Taiwan for semiconductor supply, Raimondo added.
MBA Mortgage Applications +8.6% vs -3.7% prior
MBA 30 yr Mortgage Rate +3.2% vs+3.27% prior
AheadEIA Oil Report.
Earnings Verizon, Chipotle, Whirlpool, Nasdaq, Baker Hughes, Anthem, Netgear, Spirit Airlines, Canadian Pacific Railway, Lam Research, Discover Financial, SLM, Halliburton, Knight-Swift Transportation

CSI 300 closed +15pts (+0.3%) @ 5,099
CSI300 opened lower at 5,055 but rallied to flat in the first 10 minutes before selling back down to the opening level but the worked better into lunch seeing resistance at 5,100.PM opened lower but retested the 5,100 level a few times during the afternoon but not able to hold above. Team China active in trying to push the market higher.
Some talk of optimism about President Xi attending President Biden’s climate summit and giving a speech.
Leaders medical beauty, vaccines, liquor, medicine, banking, and property sectors
Laggards steel, auto, electricity, tourism, gas, rare earth names.
Shanghai Comp flat @ 3,473
Shenzhen Comp +49pts (+0.4%) @ 14,151
ChiNext Comp +11pts (+0.4%) @ 2,978

Pre mareket opened @ 28,702 -434pts vs -358pts ADR’s
Trended lower to 28,500 level before a small uptick and traded sideways into lunch. PM initially dropped but then traded sideways but dropped 43pts in the closing auction
Investors cautious after recent placements and after market China Gas announced another one which will lead to more caution. Expect margin call selling on the open tomorrow.
The Centre for Health Protection reported 1 new covid cases (vs 8 Tuesday)

Short Selling Wednesday 12.5% vs 8.6% Tuesday
Top Shorts
  Sunny Optical (2382) 41%, Bank Of China (3988) 37%, Mengniu Dairy (2319) 36%, Bud Apac (1876) 33%, ICBC (1398) 33%, CCB (939) 32%, Sino BioPharm (1177) 32%, Country Garden (2007) 32%, BankComm (3328) 32%,  Wuxi Bio (2269) 29%, MTRC (66) 27%, Sands China(1928) 27%.

CHINA GAS HOLD (00384.HK) plans to place up to 392 million shares by top-up subscription at $29.75-30.75 each, according to market sources. The placing price represented a discount of 6%-9% to the closing price of $32.7 as quoted today (21 April). The company will raise a maximum of $12.054 billion.
In relation to a rumor spreading among WeChat group about MINSHENG BANK (01988.HK) being taken over, the bank issued a statement that the rumor is malicious disinformation, and that the company has reported the case to the Chinese public security agency and will pursue the legal responsibility of the relevant entities.
GREATWALL MOTOR (02333.HK) announced first-quarter results ended March 2021. Total operating revenue rose 150.6% year on year to RMB31.117 billion. Profit was RMB1.639 billion, as compared with RMB650 million in a year ago's loss.  EPS equaled RMB0.18.
BOJUN EDU (01758.HK) has issued a profit warning, expecting a decrease in net profit for the six months ended 28 February 2021 by approximately 40%-60%, as compared with that recorded during the six months ended 29 February 2020.
William Yeung, Co-Owner and Executive Vice-chairman of HKBN (01310.HK), announced the launch of 5G mobile virtual network operator (MVNO) through HUTCHTEL HK (00215.HK)'s 3HK network under bilateral 4G and 5G partnership.  With colleagues actively gearing up for new offers, Yeung foresaw more promotions in 5G buildout around mid-May.
CHINA UNICOM (00762.HK) announced operational statistics for March 2021 that Aggregate Number of Mobile Billing Subscribers reached 309 million, representing Net Addition of 2.957 million for the Month. In particular, Aggregate Number of 5G Package Subscribers hit 91.852 million, representing Net Addition of 7.309 million for the Month, as compared with February's 6.589 million.Also key financial and performance indicators for the first quarter ended 31 March 2021. Revenue totaled RMB82.272 billion, up 11.4% year-on-year.   Net profit +21.4% annually to RMB3.843 billion in the quarter.
HKBN (01310.HK) announced results for the six months ended 28 February 2021. Revenue reached $6.23 billion, up 39.8% yearly. Profit was $48.562 million, down 63.3%. EPS equaled 3.7 cents. EBITDA added 2% to $1.312 billion. Interim. DPS. was 39 cents.
CHINA LIFE (02628.HK) (601628.SH) announced that based on the Company’s preliminary estimates, it is estimated that the net profit for the first quarter of 2021 will increase by a range between approximately RMB9.4 billion and RMB12.818 billion as compared to the same period of 2020 (representing an increase of approximately 55% to 75%).
BIDU-SW (09888.HK) Chief Technology Officer Wang Haifeng, at the Boao Forum for Asia, said A.I. technology has penetrated into all kinds of industries. A thorough integration of A.I. technology and industrial development will hence be necessary, he opined.
EVERG VEHICLE (00708.HK) had declared in early 2021 the placement to six investors to raise $26 billion, including $5 billion worth of shares subscribed by a company under Kingkey Group Chairman Chen Hua. The deal was indeed negotiated by EVERG VEHICLE boss Xu Jiayin and Chen, where Chen will transfer Kingkey Real Estate's Shenzhen project under construction to EVERGRANDE (03333.HK) for capital, which will be used to have EVERG VEHICLE's 1.875% stake, reported Caixin.  Shares of EVERG VEHICLE eroded nearly 13% to $59.7.
*PETROCHEMS WEAK as Oil slumped overnight and API data showed a rise in stocks to add to the resurgence of covid in India and Japan; which could hurt demand.SINOPEC (386 HK -5.8%) won a contract in Iraq to develop the in the eastern province of Diyala. CH OILFIELD (2883 HK -5%) PETROCHINA (857 HK -2.5%).
*CHINESE BANKS WEAK as China's banking regulator is reportedly seeing a rebound of bad-loan pressures and is paying a lot of attention to this, CBIRC Vice Chairman Xiao Yuanqi said.  Bank names saw increased shorting; ICBC (1398 HK -1.8%) BOCOM (3328 HK. -1%) BOC (3988 HK -0.95%).
*SPORTSWEAR WEAK after ANTA SPORTS (2020 HK -7.6%) offers 88m shares at HK$131.48 each, representing  7.5% disc to last close.XTEP (1368 HK -1.8%)  NI LING (2331 HK-1.6%) POU SHENG (3813 HK -1.7%) YUE YUEN (551 HK -3.6%).
*TECH & COMPONENTS WEAK after APPLE unveiled a new iPad Pro, a refreshed iMac lineup and an upgraded Apple TV. It also confirmed the launch of a new iPhone 12 and iPhone 12 Mini models in “all-new stunning purple finish. AAC TECH (2018 HK -1.3%) SUNNY (2382 HK -2.5%) TONGDA (698 HK -1.8%) Q TECH (1478 HK -1.8%).
*E-COMMERCE WEAK as antitrust scrutiny grows. JD (9618 HK -3.6%) BABA (9988 HK -2.8%) MEITUAN (3690 HK -3.9%) TENCENT (700 HK -2.2%) .
*TELCOS FIRM  after CH MOBILE (941 HK+0.2%) overnight reported  that 1Q net income +2.6% YoY to 24.1b yuan, ebitda +5.3% to 72.1b yuan. CH UNICOM (762 HK +0.2%) reported day after market 1Q net income +21.4% YoY to 3.843b yuan. CH TEL (728 HK- 0.7%)
*AUTOS WEAK as CH EVERGRANDE NEW EV (708 HK -13%) exhibited nine electric car models in the Shanghai Auto Show for the first time as its president pledged mass deliveries by next year. But media could not get up close and personal with its Hengchi models on display as the cars were contained within glass fences and only security and company personnel were allowed in. GREAT WALL (2333 HK -4%) aims to increase annual sales of its Poer pickup trucks to more than 500k units by 2025 and become one of the world’s top-three makers of such vehicles. GEELY (175 HK -2.6%) BYD (1211 HK -2.8%).
*HK PROPERTY WEAK despite the one-month HK Interbank Offered Rate, which is linked to the mortgage rate, fell to a near 11-year low of 0.09679%, easing repayment burdens for homebuyers and a survey showing increased interest in buying. NWD (17 HK -1.6%) HENDERSON (12 HK -0.8%)  SINO LAND (83 HK -3%) KERRY (683 HK -1.7%).
*CHINA PROPERTY WEAK on credit-tightening and home curbing worries. SHENZHEN INV (604 HK -2%) March contracted sales -39.2% YoY to 844m yuan, total contracted sales +55% to 3.98b yuan during Q 2021. VANKE (2202 HK -2.3%) SUNAC CHINA (1918 HK -1.7%) JINMAO (817 HK -1.3%) CIFI (884 HK -2%).
*PHARMA FIRM  amid resurgence of Covid cases in various countries.
FOSUN PHARM (2196 HK +2.1%) INNOVENT (1801 HK +1.1%) GENESCRIPT (1548 HK +3.7%) SIHUAN PHARM (460 HK +5.5%).

Regional Markets 
Sold down in early trading to 6,950 and then bounced but unable to hold and then legged down to 6,900 level around midday and then worked better into the close to finish -20pts (-0.3%) @ 6,998
Retail Sales Prelim Mar +1.4% MoM vs -0.8% Feb (F/cast was +0.7%)
Leading Index Mar +0.38% MoM vs +0.16% feb revised (F/cast was -0.1%)
Nikkei opened -440pts and initially traded sideways but then drifted lower into lunch.  PM opened higher but trading sideways. The re imposition of emergency measures hurting sentiment. Closed -592pt (-2%) @ 28,509
Topix traded in a similar pattern currently -38pts (-2%)@1,888
SoftBank anticipates to report net profit of JPY4.5 trillion (roughly USD41.7 billion) for the fiscal year ended March 2021, the highest record ever for a Japanese company, the Nikkei reported.
Pre market PPI data was strong than forecast Kospi opened lower and saw an initial leg down to 3,950 level and then worked lower through the morning to 3,170 level around midday and then traded sideways until the last 40 minutes when it worked higher to close -49pts (-1.5%) @ 3,172
Kosdaq traded in a similar pattern currently -10pts (-0.9%) @ 1,022
Opened lower despite the good Exports data and trended lower to 17,170 level by mid morning before working higher to around the 17,250 level and traded sideways until about 12:30pm and then drifted lower into the close -122pts (-0.7%) @ 17,202
Northbound RMB 38,839m Sell 20,457m : 18,382m Buy
Southbound HK$ 14,807m Sell 6,298m : 8,509m Buy
Northbound RMB 44,376m Sell 21,679m : 22,697m Buy
Southbound HK$ 16,326m Sell 7,163m : 9,163m Buy

Active Heavyweights
MEITUAN (03690.HK) -3.9%
BABA (09988.HK) -2.8%
AIA (01299.HK) -2.2%
TENCENT (00700.HK) -2.2%
PING AN (02318.HK) -1.9%
HKEX (00388.HK) -1.5%
CCB (00939.HK) -0.8%

HSI & HSCEI Constituents on Move:
ANTA SPORTS (02020.HK) -7.7%
SINOPEC CORP (00386.HK) -5.9%
HAIDILAO (06862.HK) -3.9%
KUAISHOU-W (01024.HK) - 3.7%
JD (09618.HK) -3.6%
SHENZHOU INTL (02313.HK) -3.3%

HSMI & HSSI Constituents on Move:
ASM PACIFIC (00522.HK) +18.2%
ASCENTAGE (06855.HK) +15.8%
C&D INTL GROUP (01908.HK) +1.3%, hitting new high

India saw record-high 295,000 additional Covid cases over the day, taking the tally to roughly 15.6 million, according to health ministry data on Wednesday (21 April). Separately, Japanese Prime Minister Yoshihide Suga will reportedly postpone visits to India and the Philippines initially slated for end-April, given Covid resurgence in Japan.
The HK Government is in technical talks with the Guangdong government on mutual access to vaccination records and technological platforms, as part of their efforts to gradually revive customs clearance of the two places, said Sophia Chan, Secretary for Food and Health. The Government is working on a new scheme slated for mid-May, which will grant qualified non-Hong Kong residents from Guangdong and Macau access to the financial hub without mandatory quarantine, furthered Chan.
Hong Kong Property Survey: Residents' Mood of Buying Property Highest in 3 YrsThe questionnaire conducted by Hong Kong Property at the end of March disclosed that 50.6% respondents intended to buy a property in the next 12 months, up 11.2 ppts quarterly, logging a 12-quarter high since 1Q18.  On another note, majority of 53.8% interviewees considered the local housing prices will trend up with steadiness in the next 12 months, up 1.1 ppts quarterly.
Alibaba Cloud announced the launch of CloudQuotation, its real-time service which provides financial market quotation information on stocks, futures, derivatives and indices to brokers, banks, private equity firms, trusts, as well as internet information and fintech companies through one-stop cloud solutions.  CloudQuotation enables the global co-sharing of real-time market quotation information on Hong Kong stocks (under the cooperation with HKEX (00388.HK) and US bourses.
SenseTime announced that the Company has entered into a memorandum of understanding (MOU) with China Mobile Hong Kong (CMHK), aiming to work off their "5G+AI" advantages and develop a range of apps. As the initial project under the MOU, CMHK will strengthen its marketing leveraging SenseTime's exclusive AI technology.
SINOPEC CORP (00386.HK) has secured a contract to jointly develop Iraq's Mansuriya gas field with the state-owned Midland Oil Company, Reuters citing the local oil ministry.T
he total cost of the unmanned delivery vehicles and the automatic driving software and hardware system of MEITUAN-W (03690.HK) will be capped at RMB150,000, as Xinhua Finance quoted MEITUAN-W chief scientist Xia Huaxia, who also predicted Shanghai to receive her first unmanned delivery next year.
ASM PACIFIC (00522.HK)'s new order volume ballooned over 73% YoY to US$1.01 billion in the first quarter, topping earlier forecast of US$700 million. This was mainly driven by better-than-expected semiconductor and SMT solution performance under increasing industrial application and auto sector demand, justified CEO Robin Gerard Ng. Ng assumed the company to revive a flattish order growth in the second quarter, as investors' upbeat view on semiconductor market will be salubrious to both sales and market share gain.
CHINA SHENHUA (01088.HK) has surrendered Australia's Watermark coal project that was commenced in 2008, claiming the decision reflected "shifting economic and social circumstances", reported Bloomberg.   The New South Wales Government bought back CHINA SHENHUA's mining license at AUD100 million, according to the firm's statement.
JD-SW (09618.HK) clinched a strategic cooperation agreement with OPPO, whereby both parties agreed to achieve a short-term target of 170% annual GMV growth of OPPO-branded products on JD this year, and a mid-to-long-term goal of 100% GMV CAGR of the related products on JD in three years.
The Japanese and US governments are planning to join hands in monitoring Rakuten, fearing that the e-commerce giant's user data will fall into the clutches of China, reported Kyodo.  TENCENT (00700.HK) has become a major shareholder of Rakuten, fueling national security concerns from Washington and Tokyo..
Overnight HIBOR last posted at 0.0381%, according to HKAB. Meanwhile, the 1-Month HIBOR related to mortgage rate last stood at 0.09411%, marking a 1-month low.
A Swedish court will today (21 April) start hearing arguments regarding PTS's ban on Huawei's involvement in 5G projects.  Swedish telecom regulator PTS had barred Huawei and ZTE (00763.HK) from supplying 5G equipment in October 2020, asking them to remove the related gear by 1 January 2025.
TRIP.COM-S (09961.HK) announced that the gross merchandise  volume (GMV) of its three branded stores exceeded RMB100 million on 19 April, reflecting a significant tourism revival in China post-epidemic.   More than 70% of travelers preferred cross-province tours during the May Day holiday, according to TRIP.COM-S' data.
TENCENT (00700.HK)'s Tencent Cloud declared the cooperation with Korea's Incheon Tourism Organization to promote local tourism development by providing smart tourism solutions.  Tencent Cloud is set to offer one-stop smart tourism solutions to the organization, allowing travelers to check local weather forecasts, explore shopping, look for tour guides, restaurants, scenic views and tourist attractions, download coupons and apply for tax refund via WeChat mini-programs.
BABA-SW (09988.HK)'s Alibaba Cloud announced that Yunnan Yunshangyun had recently won the tender for the phase II set-up project of Yunnan province's health insurance information platform (smart health insurance).   Accordingly, Alibaba Cloud's software products will be adopted on the cloud platform across core business districts, likely covering almost 50 million people in the province.
HENGAN INT'L (01044.HK)  announced the repurchase of 400,000 shares on 20 April at $51.45-51.9 each, involving $20.634 million.
Singapore's government announced that from 00:00 on 23 April, visitors from Hong Kong or having been to Hong Kong over the past 14 days will have to serve a 7-day quarantine possibly at their place of residence upon arrival, against the previous 14-day period.
ESPRIT HOLDINGS (00330.HK) announced that its rights issue was over-subscribed by 6.56%. The company had announced earlier a proposed rights issue on the basis of one rights share for every two shares.
The Hong Kong Government announced that about 1.1497 million doses of COVID-19 vaccines have been administered to the public, with about 758,700 people receiving their first dose. Of which, 385,200 people have received the Sinovac jab and 373,500 people have received the BioNTech one.  About 391,000 people have gotten their second dose. About 241,900 people have received the Sinovac vaccine, while 149,100 people have been administered the BioNTech jab.
BABA-SW (09988.HK) invested US$350 million in capital increase to the renowned Turkish e-commerce platform Trendyol, reported Reuters. The Chinese giant, having invested in Trendyol in 2018, boosted its stake to 86.5% following this transaction.
While HSBC HOLDINGS (00005.HK) is shipping four senior executives to Asia, this move has brewed some discontent, Bloomberg learnt from insiders.  Some senior executives in Greater China are concerned that this move may slow the group's push into Asia, said the report, and the regional chief Peter Wong, who had enjoyed a high degree of autonomy so far, was frustrated by the costs of relocations.
HKTV (01137.HK) announced FY20 annual report that total salaries and discretionary bonuses of Vice Chairman Ricky Wong was $19.901 million, up 2.3 times yearly.Tesla  apologized on Weibo for failing to address a car owner's woes in time at Auto Shanghai on Monday (19 April).The EV maker has established a special team in this regard, striving to cater to car owners' demands.  A woman, wearing a T-shirt that says "brake malfunction" with a Tesla logo, climbed onto a car and shouted about the EV maker's vehicle malfunctions at the auto show.
Chinese President Xi Jinping will attend a leaders' climate change summit via video conference on 22 April and give a significant speech upon invitation from his US counterpart Joe Biden, announced Chinese Foreign Ministry Spokeswoman Hua Chunying.
Another round of CATHAY PAC AIR (00293.HK)  layoffs is slated for June 2021, targeting office staff, back-office workforce and Boeing 777 pilots, local media citing labor union sources.  The carrier also intends to put forward furloughs, where employees taking a 9-month unpaid leave will enjoy one month's salary. Those taking a 12-month unpaid leave can receive two months' salary.  CATHAY PAC AIR declined to comment on the rumors.
Apple unveiled the AirTag tracker, an Apple TV 4K, a next-generation iMac, a new iPad Pro, and a purple iPhone 12 at an event.  AirTag will help users find keys and other items. The tracker is priced at $239, with pre-order starting 8pm this Friday and delivery slated for May at the soonest.
U.S. Federal Reserve Chair Jerome Powell wrote in a letter to Senator Rick Scott that the economy is set to see “a little higher” inflation temporarily this year upon faster recovery and higher prices in some sectors due to supply constraints, cited Reuters Nevertheless, the central bank is not allowing the inflation to substantially overshoot the 2% target for a “prolonged” period.
Ninebot (689009.SH), a Xiaomi's ecological chain company, is magnifying the investment to dabble in the NEV manufacturing industry, as learnt from multiple channels.  Ninebot's holding subsidiary has recently obtained the strategic investment from XIAOMI-W (01810.HK)  -0.350 (-1.306%)    Short selling $451.82M; Ratio 13.630%   , Sequoia Capital and so on.
After Macao Government Tourism Office announced that the hotel occupancy rate has recently grown to 70-80% from approximately 50% earlier, some hoteliers expect the rate to hit even 80% or above, and room rates up 10% from weekdays, during "May 1 Golden Week" upon positive signs, cited Macao Daily.  Based on the current patronage figure, the Hoteliers and Innkeepers Association opined there is no condition for room rate upsurge.
SHENHUA HOLDINGS (600653.SH)  SJA (600609.SH)  announced that the indirect controlling shareholder Huachen Automotive Group and the concerning persons had received the Advance Notice of Administrative Penalty from China Securities Regulatory Commission (CSRC).   Huachen Automotive was reprimanded and ordered to take remedial measures by CSRC. The Company was fined for a total of RMB53.6 million
ASM PACIFIC (00522.HK) announced first quarter results ended March 2021. Net profit amounted to $522 million, up 21.1 times yearly.  EPS equaled $1.27.
ANTA SPORTS (02020.HK) announced that it has been informed by its controlling shareholder Anta International about the planned placement of an aggregate of 88 million shares of the Company, representing 3.26% of the issued share capital at a price of HK$131.48 per Share (a 7.5% discount to the Company's closing price of HK$142.2 yesterday).  Anta International would cash in HK$11.57 billion.
CHINA MOBILE (00941.HK) announced that it had 940 million mobile subscribers in March 2021, representing a net addition of 2.425 million (February net loss: 3.692 million).  During the month, the number of 5G package customers reached 188.8 million, representing a net addition of 15.593 million (February net addition: 4.197 million).

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