HSI +478pts (+1.7%) 29,386 HSCEI +281pts (+2.5%) 11,340 T/O HK$215.26bn (+13% DoD)
Markets opened higher but trending lower ahead of the ECB press conference and comments about yields.FTSE and DAX currently trading around flat CAC trading just above flat. France’s EDF strong but housebuilder Persimmon weakEarnings due from Generali, Hugo Boss, Rolls-Royce, WPP, Morrisons and John Lewis Partnership.
Rolls-Royce’s announced FY20 loss deepened 1.4 times to GBP3.169 billion. Underlying loss before tax was GBP3.958 billion, deeper than market estimates.
EUROZONE ECB Interest Rate Decision, Marginal Lending Rate, Marcoeconomic Projections
Rallied through the day Dow now +142pts S&P +0.6% and NDX +1.1%
Apple was said to have trimmed iPhone orders by 20% given lower demand for its iPhone 12 mini devices. However, a source from Apple's supply chain leader dismissed the above rumor today, according to Chinese media. Apple indeed saw better-than-expected sales of iPhone 12 and iPhone 12 pro, the person added.
Data Initial Claims, 4 Week Average Claims, Continuing Claims, JOLTs Job Openings, EIA Natural Gas Change Report.
Earnings Ulta Beauty, Vail Resorts, DocuSign, Poshmark, Gogo, Zumiez, JD.com, WPP, Party City
CSI 300 closed +125pts (+2.5%) @ 5,128
CSI 300 opened higher after the good loans data and after rallied to 5,138 in the morning session before easing back into lunch. PM initially traded sideways but then sold down to 5,080 before bouncing and working better into the close
Shanghai Comp +79pts (+2.4%) @ 3,437
Shenzhen Comp +303pts (+2.2%) @ 13,866
ChiNext +71pts (+2.6%) @ 2848
CHINA DATA China Academy of Information and Communications Technology (CAICT) said in February 2021, China's 5G handset shipment reached 15.071 million units domestically, with the proportion rising to 69.3%, The overall shipment volume
of the domestic mobile phone market was 21.759 million units, an increment of 240.9% year-on-year.
Pre market opened @ 28,909 +2pts vs +95pts ADRs
Rallied in early trades to 29,370, as shorts covered and investors reacted to the strong China loans data Then worked higher to test 29,400 before easing back into lunch. PM Opened lower and sold down to 29,100 before bouncing and worked better for the rest of the afternoon with resistance at 29,400
Renewed interest in Chinese Financials and Ecommerce although Baba weak on possible listing rule changes to the Star Board which could make it harder for Ant to list . Broad based buying but HK Property names still seeing some pressure.
HONG KONG DATA
The Centre for Health Protection reported 22 new covid cases (vs 8 Wednesday) 3 from unknown sources. 16 diagnoses were found at the gym room Ursus Fitness. Moreover, the authority also confirmed more than 40 initially positive cases.
SHORT SELLING Thursday 12.8% vs 13.5% Wednesday
Top Shorts Bud Apac (1876) 51%, HSBC (5) 36% (Moodys put on Watch list for downgrade Wednesday), Ping An (2318) 36%, Bank of China (3988) 34%, AIA (1299) 33%, Sands China (1928) 31%, ICBC (1398) 30%, Hang Seng Bank (11) 29%, Sino Biopharm (1177) 29%, Anta (2020) 28%, MTRC (66) 28% (reported a loss after market), Hengan (1044) 28%, CKH (1) 27%, CCB (939) 27%, Henderson Land (12) 25%.
Earnings due Friday incl AIA Group (1299), China Res Cement (1313), Texhong Textile (2679).
KWONG LUEN ENG (01413.HK), on debut, settled the trade at $0.42, down 12 cents or 22% against the listing price $0.54, on volume of 343 million shares and turnover of $157 million. Excluding the handling fees, a book loss of $600 was reported per board lot of 5,000 shares.
AFTER MARKET NEWS
JD-SW 4Q20 Non-GAAP NP Leaps 194% YoY to RMB2.4B, Operating Rev. Gains 31.4% YoY to RMB224.3B, Beating Estimate. Active Users Hike 30.3% to 472M. Stock trading higher in US pre market.
Jardine Matheson is facing opposition from minority shareholders after announcing Monday a US$5.5-billion privatization scheme, Bloomberg reported. Some shareholders are mulling a lawsuit and seeking reasonable valuation in Bermuda for the deal which they say is made at a US$1 billion discount, said an advisor to the investors.
CHINA UNICOM (00762.HK) announced the results for the year ended 31 December 2020. Net profit amounted to RMB12.493 billion, representing a year-on-year increase of 10.3%. EPS was RMB0.41. Also that FY21 Budget CAPEX was fixed at RMB70 billion, flattish yearly, among which RMB35 billion will be spent on 5G projects, up RMB1 billion yearly. It’s 2020 Mobile ARPU grew 4.1% yearly to RMB42.1. Wang Xiaochu, Chairman and Chief Executive Officer, said the 5G ARPU hit about RMB70 last year, expecting such level to drop with increasing new 5G users in future. Yet, he believed the entire Mobile ARPU will hike steadily, aided by about 10% increment in 5G ARPU shifted from 4G users' plan. It forecast 2020-22 to remain as an investment peak period for 5G with an annual investment budget of around RMB70 billion. He also assumed the number of 5G base stations to add to 1 million, spanning coverage from major cities, industrial areas to main transport hubs.
SWIRE PACIFIC A (00019.HK)'s Chairman Merlin Swire said It had derived around $45 billion of funds from non-core asset disposal in the past few years, contributing to the strength of its balance sheet, said Chairman Merlin Swire. He added the group now has ample funds to develop its core business.Also the group's CATHAY PAC AIR (00293.HK) tracked healthy cash flow since the capital restructuring last year, and hence the group has found no need to increase capital from shareholders. He restated the group's confidence on the long-term development of CATHAY PAC AIR, adding it will continue to support the airline if necessary. On another note, SWIRE PROPERTIES (01972.HK) Chief Executive Guy Bradley foretold more emphasis to be put on Mainland business buildout in the future.
CHINA UNICOM (00762.HK) announced the results for the year ended 31 December 2020. Net profit amounted to RMB12.493 billion, representing a year-on-year increase of 10.3%. EPS was RMB0.41. EBITDA was RMB94.14 billion, down by 0.2% year-on-year.
MTR CORPORATION (00066.HK) announced annual results ended December 2020. Revenue declined 21.9% yearly to HK$42.541 billion. Loss was HK$4.809 billion, in-line with HK$0.375-4.932 billion in broker forecast as compiled by our reporters. LPS equaled HK$0.78. Final DPS was HK$0.98, flattish yearly. Full-year DPS was HK$1.23, flattish yearly.
PCCW (00008.HK) said that Viu, its leading pan-regional OTT video streaming service, ranks first in aggregate monthly active users amongst premium major video streaming platforms in Southeast Asia (Indonesia, the Philippines, Singapore and Thailand) in Q4 2020 according to a report from AMPD Research. Viu had 45 million monthly active users (MAU) as of December 2020.
*PETROCHEMS STRONG Oil rebounded in the US despite the large than expected rise in crude inventories as expectations for demand increased following the passing of the stimulus bill. Gasoline stocks fell more that expected; dropping by 11.87m barrels last week, as demand for gasoline surged. CH OILFIELD (2883 HK +10%) CNOOC (883 HK +4%) PETROCHINA (857 HK +2.7%).
*BASE METALS STRONG on expected demand increase as economies recovery globally. ANGAN (347 HK +5.8%) JIANGXI COPPER (358 HK +8.5%) CHALCO (2600 HK +13%). CH HONGQIAO (1378 HK+1.8%) raised HK$2.32b in top-up placement, offering shares at HK$9.72 each, ~11% disc to last closing price of HK$10.92. CH RAREEARTH (769 HK +11.3%) and ZIJIN MINING (2899 HK+12%) also rallied.
*CHINESE BANKS MIXED after China's February new loans were better than expected. The credit expansion was mainly in the form of corporate loans, which the PBOC tends to favor. This probably reflects continued strong funding demand from corporates; taken as a sign of confidence.
CCB (939 HK +1.7%) ICBC (1398 HK +0.7%) ABC (1288 HK -0.3%) CMB (3968 HK +3.7%) BOC (3988 HK -0.7%).
*E-COMMERCE FIRM as inflation worries eased, but ALIBABA (9988 HK -0.4%) on the news that CSRC is considering tightening rules for first-time share sales on STAR Board, that will require firms to prove their technology credentials and raise the bar for companies such as the Ant Group. TENCENT (700 HK +3.3%) is said to be selling some of its share investments in listed companies worth over US$280b. The news came as Tencent's investment in 100 listed companies posted unrealized gains of around US$120b, six times more than the firm's own expected net income for the year. MEITUAN (3690 HK +8.7%) on the news that the group will list its "flash sales" division Tuanhaohuo as one of its business priorities in 2021, as it core business is basically stable.
*TECH & COMPONENTS FIRM on hopes that tensions between China and the US may ease as the two nations agreed to start high level strategic dialogue next week. Also the China Semiconductor Industry Assoc. says it will work with its US counterpart on chip-related issues. TRULY (732 HK +10.5%) HUA HONG (1347 HK +14%) SMIC (981 HK +10%) BYDE (285 HK +6.6%) ZTE (763 HK +4.5%).
S&P Dow Jones Indices confirms it will proceed to remove certain Chinese companies, including XIAOMI (1810 HK+0.2%) (although MSCI going to wait until Friday before making the decision), that are impacted by the US sanction, effective March 15.
*SPORTSWEAR STONG after Adidas's 4Q earnings beat expectations and it focus more direct sales . Y
UE YUEN’s (551 HK +6.2%) net consolidated operating rev in Feb +77% YoY to USD755m.
POU SHENG (3813 HK +12.6%) net consolidated operating revenue in Feb +695% YoY to 2.45b yuan.
LI NING (2331 HK +7.8%) founder to launch a Spac in NY
TOPSPORTS (6110 HK +12.6%)
*HK PROPERTY MIXED on concerns about Mainland action to solve the HK housing issue and earnings SWIRE PAC (19 HK +1%) swung to a net loss of nearly HK$11b last year; due to loss from CATHAY PACIFIC and a significant reduction in profits on the sale of investment properties. SWIRE PROP's (1972 HK unchg) net profit tumbled by 69.5% YoY to HK$4.1b; core profit fell by 47% to HK$12.86b. SHKP (16 HK -1%) CKA (1113 HK +0.3%) NWD (17 HK +1.5%).
*EDUCATION PROVIDERS STRONG despite news said that some local govts in China are carrying out inspections of after-school tutoring institutions and have suspended offline classes until further notice. NEW HIGHER EDU (2001 HK +3%) VIRSCEND EDU (1565 HK +4.7%) WISDOM EDU (6068 HK +4.2%) HOPE EDU (1765 HK +3.3%).
*AIRLINES STRONG on hopes of a swift recovery as Covid inoculation roll out continues globally. CATHAY PACIFIC (293 HK +4.6%) reported a net loss of $2.8b for 2020. Cathay expects to operate at well below 50% passenger capacity in 2021. CSA (1055 HK +7.3%) CEA (670 HK +3.7%) AIR CHINA (753 HK +3.3%).
ASX 200 after an initial spike the market sold down to 6,650 level but working back to flat but failed to breakable and then eased back and traded sideways to close flat @ 6,714Materials sector erased earlier losses and the energy subindex rose 0.38%. Rio Tinto +1.1% and Fortescue +2.2% BHP -1.7%, banking stocks also declined.
Data Consumer Inflation Expectations Mar +4.1% vs +3.7% Feb (F/cast was +3.8%)
Tomorrow we get New Home Sales.
In line PPI data and easing inflation fears encourage investors.
Nikkei opened flat as PPI data related but worked higher through the morning to 29,181 at lunch. PM saw an initial dip but then worked higher to test 29,255 but failed to break on first attempt but rallied at the end to close onto day high +175pts (+0.6%) @ 29,212
Topix traded in a similar fashion although did dip into the red in initial trading and after lunch but worked higher in the PM to close +5pts (+0.3%) @ 1,925
Data Pre market
PPI Feb -0.7% YoY vs Jan was -1.6% YoY ( F/cast was -0.8%)
PPI Feb +0.4% MoM vs +0.4% Jan (F/cast was +0.4%)
Foreign Stock Investment Yen -136.9 vs -453.8 prior revised from -454.6b
Foreign Bond Investment Yen 98.9b vs -1719.6b prior
Tomorrow pre market BSI Large Manufacturing Data.
Investors encouraged by the tame US inflation data; foreigners and institutions buying with large caps in focus.Kosdaq opened higher and worked higher to 907 but the drifted lower to close +18pts (+2%) @ 908Kospi traded in a similar pattern, resistance at high 3,028 and eased back to close +56pts (+1.9%) @ 3,014.
Opened higher after good numbers from TSMC and other local companies and worked higher but saw resistance to 16,200 and traded sideways in the later session to close +268pts (+1.7%) @ 16,180
CONNECT FLOWS (flows flat DoD)
Northbound RMB 52,863m Sell 24,541m : 28,322m Buy
Southbound HK$ 24,254m Sell 11,387m : 12,868m Buy
Northbound RMB 59,838m Sell 28,450m : 31,388m Buy
Southbound HK$ 22,744m Sell 9,850m : 12,894m Buy
MEITUAN (03690.HK) +8.7%
HKEX (00388.HK) +3.7%
TENCENT (00700.HK) +3.3%
CCB (00939.HK) +1.9%
AIA (01299.HK) +1%
PING AN (02318.HK) +0.5%
BABA (09988.HK) -0.4%
HSI & HSCEI Constituents on Move:
CSPC PHARMA (01093.HK) +10.9%
KUAISHOU-W (01024.HK) +10.6%
SMIC (00981.HK) +10.1%
CHINA FEIHE (06186.HK) +8.9%
JD HEALTH (06618.HK) +7.9%
ALI HEALTH (00241.HK) +7.7%
WUXI BIO (02269.HK) +7.3%
TECHTRONIC IND (00669.HK) +6%
JD (09618.HK) +5.7%
MENGNIU DAIRY (02319.HK) +5.4%
CPIC (02601.HK) +5%
SHENZHOU INTL (02313.HK) +4.5%
ANTA SPORTS (02020.HK) +4.2%
GEELY AUTO (00175.HK) +3.9%
CM BANK (03968.HK) +3.7%
CNOOC (00883.HK) +3.1%
HAIDILAO (06862.HK) +3.1%
HSMI & HSSI Constituents on Move:
HUA HONG SEMI (01347.HK) +14%
WEIMOB INC (02013.HK) +13.7%
FRONTAGE (01521.HK) +12.9%
CHALCO (02600.HK) +12.8%
POU SHENG INT'L (03813.HK) +12.6%
TOPSPORTS (06110.HK) +12.6%
ZIJIN MINING (02899.HK) +12.5%
MMG (01208.HK) +12.4%
KB LAMINATES (01888.HK) +12.1%
COSCO SHIP HOLD (01919.HK) +11.4%
SIHUAN PHARM (00460.HK) +11.2%
YADEA (01585.HK) +10.7%
SINOTRANS (00598.HK) +6.6%, hitting new high
YUE YUEN IND (00551.HK) +6.2%, hitting new high
CHINA LESSO (02128.HK) +6.1%, hitting new high
XINYI GLASS (00868.HK) + 5.1%, hitting new high
JNBY (03306.HK) +5.1%, hitting new high
MARKET HOURS NEWS
The fourth session of the 13th National People's Congress (NPC) concluded at the Great Hall of the People at 3pm today (11 March). The meeting voted to improve the election system (draft) of the HKSAR, which had been passed with 2,895-to-0 votes.
China Association of Automobile Manufacturers (CAAM) Deputy Secretary-General Chen Shihua said chip shortage is a global issue, which has taken the heaviest toll on China in the first quarter. It is measured that there will be around 5%-10% impact on the production. Yet, Chen said the current shortage should be brief, foreseeing the problem to subside in the second quarter.
Singapore remains yet to give up on forming a bilateral “air travel bubble” with Hong Kong, Transport Minister Ong Ye Kung told CNBC.
Baidu will initiate its Hong Kong public offering tomorrow and sell roughly 4% of its shares, likely fetching at least US$3 billion, sources with direct knowledge of the matter were quoted as saying by Reuters.
HKEX (00388.HK) announced the appointment of Paul Chow as its Group General Counsel, effective 19 April 2021. Chow will provide strategic legal counsel to the HKEX Board and senior management team, and head HKEX's Legal and Secretarial Services Department.
CNOOC (00883.HK) announced in relation to the U.S. government's Executive Order and the decision of The New York Stock Exchange LLC (the NYSE) to delist the American depositary shares (the ADSs) of the Company. In order to protect the lawful rights of the Company and its shareholders, on 10 March, the Company filed with the NYSE a written request for a review of the Determination by a Committee of the Board of Directors of the NYSE.
A Facebook-led consortium told U.S. FCC in a filing that it had scrapped the Hong Kong-Americas project (HKA) aiming to build a new underwater internet conduit between Hong Kong and the U.S., reported WSJ. Backed in 2018, Facebook and several telecom partners had applied to build the fiber-cable link, which would connect two California sites with branches to Hong Kong and Taiwan.
Australia & New Zealand Banking (ANZ) plans to slash jobs at its service centers in Chengdu, Sichuan and shift some of the positions to India, the Philippines and Australia as part of its global restructuring.
HSBC HOLDINGS (00005.HK) announced that it will propose a special resolution on climate change at the Annual General Meeting on 28 May 2021. The resolution will set out the next phase of HSBC’s strategy to support its customers on the transition to net zero carbon emissions. HSBC’s resolution will be the sole resolution on climate change at this year’s AGM. ShareAction and a number of shareholders who had originally proposed a separate shareholder resolution on climate change, have agreed to withdraw this and support HSBC’s resolution, following constructive and positive discussions based on a common goal of helping to build a net zero global economy.
At lunch SWIRE PROPERTIES (01972.HK) announced that FY20 profit attributable to the shareholders slid 69.5% yearly to $4.096 billion. EPS equaled $0.7. Underlying profit slipped 47.5% to $12.679 billion. Second interim DPS was $0.61. Full-year DPS was $0.91.
At lunch SWIRE PACIFIC A (00019.HK) (00087.HK) announced annual result ended December 2020. The revenue declined 6.6% year on year to HK$80.032 billion. The profit swung into loss of HK$10.999 billion. LPS for "A" share and "B" share were HK$7.32 and HK$1.46. The second interim DPS for "A" share and "B" share were HK$1 and HK$0.2.
At lunch EB ENVIRONMENT (00257.HK) announced annual results ended December 2020. Net profit amounted to HK$6.016 billion, up 15.6% yearly. EPS equaled HK97.93 cents. Final DPS was HK16 cents.
At lunch GIORDANO INT'L (00709.HK) announced annual results ended December 2020. Loss was $112 million, against $230 million in profit a year ago. LPS equaled 7.1 cents. Final DPS was 6.9 cents.
China Semiconductor Industry Association announced that it will co-establish with US Semiconductor Industry Association a "US-China semiconductor technology and trade restriction taskforce" after several rounds of negotiations.
The new SPAC founded by Chinese ex-gymnast Li Ning seeks to raise about US$250 million in an NYSE IPO, in hopes of fully leveraging consumption and the sportswear brand's prospect in China, reported WSJ. The vehicle, named Trinity Acquisition Corp., was established by Li Ning, LionRock Capital and former Goldman Sachs executive David Tse Young Chou, according to filings to US SEC.
Overnight HIBOR last posted at 0.03774%, according to HKAB. Meanwhile, the 1-Month HIBOR related to mortgage rate last stood at 0.16976%, up for 5 days, marking a 1-month high.
XINYI GLASS (00868.HK) On 9 March CEO Tung Ching Sai acquired 1.5 million shares, involving $32.2418 million, according to the shareholding disclosures at the Stock Exchange.
Taiwan's central bank governor Chin-Long Yang said the US will latently list Taiwan as a currency manipulator. Taiwan will stay in close touch with Washington to keep her updated on the reason behind strengthening TWD.
RS MACALLINE (01528.HK)'s business management segment, Aegean, is now working on a planned IPO in Hong Kong, valued RMB12-15 billion, Chinese media learnt from insiders.
China's Ministry of Industry and Information Technology (MIIT) released the PV Manufacturing Specifications (2021 version) (draft), and the Interim Measures for Announcement Management of the PV Manufacturing Industry Standard (2021 version) (draft). MIIT will thus guide PV firms to scale down PV manufacturing projects simply dedicated to capacity ramp-up. Accordingly, Beijing aims to step up tech innovation, boost product quality and reduce production costs.
MEITUAN-W (03690.HK) split flash sale division at last year end into three independent units, namely flash sales, pharmaceutical and good stocking, LatePost reported. Among which, good stocking unit will be the development focus of this year, meaning MEITUAN-W plans to further beef up the e-commerce investment.
BABA-SW (09988.HK) is integrating its internal resources into a community group buying unit "Ling Xiao Wa Select”, Chinese media citing insiders. The giant initially plans to roll it out in Henan cities like Zhengzhou, Xinxiang and Jiaozuo, with promotions beginning as soon as late March.
The Government announced that for the past 24 hours ended at 8pm yesterday (March 10), a total of about 16,800 persons received their first dose of vaccine. About 10,900 persons received their first dose of the Sinovac vaccine; about 5,900 persons received their first dose of the Comirnaty vaccine at seven Community Vaccination Centers. For the past 24 hours ended at 0000 hours yesterday, there were seven cases of ambulance transfer to hospital. Among them, five cases were discharged and two cases were admitted for observation.
PRE MARKET HOURS NEWS
NTES-S (09999.HK) seeks to spin off NetEase Cloud Music for listing in Hong Kong, with substantial progress in preparations, Jiemian citing sources. An IPO application could be filed next year. NTES-S launched its cloud music business in 2013, while boasting more than 800 million users in 2Q19.
At China's Two Meetings, SFC Chairman Tim Lui floated five ways to cement Hong Kong's role as a financial hub under the "dual circulation" policy of China, including a fostered tie with Shenzhen to co-join the PBoC' research and application of digital currencies and to, in particular, develop the Chinese central bank's digital currency application in cross-border trade financing and offshore payment and settlement, cited Hong Kong Economic Journal. In order to take forward the GBA buildout, Lui recommended issuance of "GBA green cards" to senior executives of domestic and foreign financial institutes, so that the cross-border circulation of financial talents, capital and information can be facilitated.
MSCI said it will put off its decision on whether to remove XIAOMI-W (01810.HK) from their index until Friday since the company has take the case to court seeking pause on investment ban, However, MSCI will still delete AMEC (688012.SH) from the index after market close on Friday as scheduled.
SUNAC SERVICES (01516.HK) announced annual results ended December 2020. Net profit amounted to RMB626 million, up 131.8% yearly. EPS equaled RMB0.25. Final DPS was 5.8 fen.
GDS-SW (09698.HK) announced annual results ended December 2020. Net revenue rose 39.2% yearly to RMB5.739 billion. Loss deepened to RMB738 million from RMB500 million in the previous year. LPS equaled RMB0.59.
TENCENT (00700.HK) officially marketed its ROG gaming phone 5 series yesterday, including ROG Phone 5, Pro and Ultimate. The ROG Phone 5 will be priced from RMB3,999. The series will go on sale at 10:00 on 12 March.
Zhang Yunyong, General Manager of China Unicom Product Center cum a member of the National Committee of the CPPCC, revealed that the 5G network scale will expedite during the 14th Five-Year Plan period, and that there should be no obstacle in achieving 56% 5G popularity, China Securities Journal reported.
LANGUANGJUSTBON (02606.HK) announced the results for the year ended 31 December 2020. Net profit climbed 24.1% yearly to RMB533 million with
EPS of RMB2.99. No final dividend was declared.
PRADA (01913.HK) announced the results for the year ended December 31, 2020. The loss was EUR54.14 million against the net profit of EUR256 million from a year ago. LPS was EUR0.021. A final dividend of EUR0.035 per share was declared.
TIMES NEIGHBOR (09928.HK) announced the results for the year ended 31 December 2020. Net profit burgeoned 141.5% yearly to RMB233 million with
EPS of 25 fen. A final dividend of 7.1 fen per share was declared.