HSI +50pts (+0.2%) 30,645 HSCEI +65pts (+0.5%) 12,107 T/O HK$253.28bn (-10.4% DoD)
FTSE opened flat and trading sideways after weak Retail Sales data and news of Sterling firmer vs USD. DAX and CAC opened higher and working higher on good data.
Earnings in focus
Allianz +VE announced a 14% decline in full-year net profit as business claims spiked due to lockdowns and demand for car and travel insurance dwindled. The German insurer said it sees operating profit rising in 2021.
Renault weak announced a record annual loss of 8 billion euros ($9.7 billion) in 2020.
Hermes strong beating expectations on the back of 16% sales growth in Q4
Leonardo strong after Italian press reports that the company could raise up to 2.1 bn euros from listing its U.S. unit DRS on the New York Stock Exchange. Moncler +VE after its full-year earnings report.
French real estate group Gecina weak after its results.
Travel and Leisure leading the gains with Petrochems the laggard.
US T10 back above 1.3% raising inflation concerns.
G7 Leaders hold a virtual meeting today.
Germany’s regulator on Thursday declared that the AstraZeneca-University of Oxford vaccine was “highly effective” and said negative side-effects are short-lived.
Services Feb 44.7 vs 45.4 Jan (F/cast was 45.6)
Manufacturing Feb 57.7 vs 54.8 Jan (F/cast was 54.5)
Composite Feb 48.1 vs 47.8 Jan (F/cast was 48)
PPI Jan +1.4% MoM vs +0.8% Dec (F/cast was +0.6%)
PPI Jan +0.9% YoY vs +0.2% Dec (F/cast was 0%)
Flash PMI Services Feb 45.9 vs 46.7 Jan (F/cast was 47)
Manufacturing Feb 60.6 vs 57.1 Jan (F/cast was 56.9)
Composite Feb 51.3 vs 50.8 Jan (F/cast was 50.9)
FRANCE Inflation Rate Jan +0.6% YoY vs 0% Dec (F/cast was +0.6%)
Inflation Rate Jan +0.2% MoM vs +0.2% Dec (F/cast was +0.2%)
Flash PMI Services Feb 43.6 vs 47.3 Jan (F/cast was 47.5)
Manufacturing Feb 55 vs 51.6 Jan (F/cast was 51.1)
Composite Feb 45.2 vs 47.7 Jan (F/cast was 48.1)
UK Consumer Confidence Feb -23 vs -28 Jan (F/cast was -26)
Retail Sales Jan -5.9% YoY vs +3.1% Dec revised (F/cast was -0.7)
Retail Sales Jan -8.2% MoM vs +0.4% Dec revised (F/cast was -1.8%)
Retail Sales Ex Fuel Jan -8.8% MoM vs +0.4% Dec (F/cast was -2%)
Retail Sales Ex Fuel Jan -3.8% YoY vs +6.7% Dec (F/cast was +2.1%)
Flash PMI Services Feb 49.7 vs 39.5 Jan (F/cast was 40)
Manufacturing Feb 54.9 vs 54.1 Jan (F/cast was 54.5)
Composite Feb 49.8 vs 41.2 Jan (F/cast was 41.5)
Public Sector Net Borrowing Jan GBP -8.75b vs -26.8b Dec (F/cast was -26b)
CBI Industrial Trends due later Jan was -38 (F/cast iOS -36)
Opened Dow +35pts, S&P and NDX both slightly higher; as Janet Yellen told CNBC Thursday after the bell that more stimulus is necessary even as some economic data suggested a swift rebound. But then sold down in Asian time but now recovering as Europe starts trading Dow +55ptsm S&P flat, NDX higher.
AHEAD Flash PMI (Services, Manufacturing and Composite), Existing Home Sales, Baker Hughes Rig data.
CHINA CSI 300 closed +11pts (+0.2%) @ 5,779
|CSI 300 opened lower but initially tested higher to yesterday’s close but failed and then sold down through the morning with support at 5,667 which it tested a could of times before rallying into lunch. PM opened higher and worked higher but hit resistance @ 5,786 and traded sideways into the close.
Looked like Team China keen to see the markets +VE.
White liquor sector saw renewed interest while Non-ferrous and Agricultural names led the gainers. Investors remain concern about the PBoC tightening liquidity, though the central bank-backed Financial News said investors shouldn't pay too much attention to the size of PBOC open market operations, but instead focus on policy indicators such as OMO and MLF rates. Regardless investors will remain concerned.
Northbound funds bought nearly 10b yuan today.
No data today But on Monday we get Loan Prime Rate data on the open.
Pre market opened @ 30,483 -112pts vs -115 ADRs
Market saw a choppy start dropping 200pts in early trades, which is likely to have been marginal selling, then rebounded to the opening level only then trend lower for the next hour. Found support at 30,100 and then worked higher into lunch. PM working higher and approached yesterday’s closing level after China closed and broker above to 30,720 but eased back into the close and ticked lower in the closing auction.
Telcos strong as a safe utility play with consumer names but Ecommerce names remain weak along with Auto and Petrochems
HONG KONG DATA Centre for Health Protection said there were 13 new COVID-19 cases in Hong Kong today; (vs 8 Thursday) with 8 from unknown sources.
SHORT SELLING Friday 13% vs 14.2% Thursday
Top Shorts: Hengan (1044) 48%, Bud Apac (1876) 47%, Hang Seng Bank (11) 41%, Ping An (2318) 40%, Bank of China (3988) 35%, China Res Land (1109) 33%, BankComm (3328) 31%, Hang Lung Ppty (101) 30%, Sands China (1928) 29%, CCB (939) 28%, NWD (17) 27%, Wharf REIC (1997) 25%
PANGAEA CONNECT (01473.HK), on debut, concluded the day at $0.71, up 15 cents or nearly 27% against the listing price $0.56, on volume nearly 402 million shares and turnover of $294 million. Excluding the handling fees, a book gain of $600 was reported per board lot of 4,000 shares.
AFTER MARKET NEWS
China’s State Administration of Foreign Exchange (SAFE) announced that in terms of USD, China's current account recorded surplus of USD298.9 billion in 2020.
SCICLONE PHARMA (06600.HK)’s IPO registered margin of approximately $33.58 billion granted by local brokers as at around 6 pm. Based on the public fundraising amount of about $218 million, the IPO was over-subscribed by 153 times.
Macau Tourism Office announced that during the Spring Festival Golden Week on 11-17 February 2021, the number of visitors was 90,615 and the average occupancy rate of hotel rooms was 48.3%. During the period, the average room rate of hotels and apartments approximated MOP1,175.3, down 42.1%.
Hang Seng Indexes Company has licensed the Hang Seng China Enterprises Index to ChinaAMC to serve as the underlying index for the creation of an exchange-traded fund (ETF). The ChinaAMC Hang Seng China Enterprises ETF was listed on the Shenzhen Stock Exchange today (19 February).
The Hong Kong Monetary Authority (HKMA) announced that the composite interest rate, a measure of the average cost of funds of banks, decreased by 4 basis points to 0.24 per cent at the end of January 2021, from 0.28 per cent at the end of December 2020.
CHINA TAIPING (00966.HK) announced that the gross premium income for January reached RMB41.047 billion, up 4.85% year-on-year.
BUD APAC (01876.HK) announced that Guilherme Strano Castellan will step down as the chief financial officer on 28 February 2021 and that Ignacio Lares has been appointed as the Chief Financial Officer as from 1 March 2021.
CCL last printed at 176.11, -0.24% weekly.
CCL Mass dipped 0.4% weekly to 178.4.
CCL (small-to-medium flats) faded 0.29% weekly to 176.2.
The three major indices hit the soft spot after two weeks of rally, with an ongoing uptrend. Over the past three weeks, CCL +0.61% CCL Mass +0.46% and CCL (small-to-medium flats) +0.59%.
*PETROCHEMS WEAK despite the fall in oil inventories and the production problems in the US. CH OILFIELD (2883 HK -4.9%) CNOOC (883 HK -2%) PETROCHINA (857 HK -1.1%) JUTAL (3303 HK -5.3%).
*E-COMMERCE WEAK as investors remain concerned about the inflation implications. China's largest micro-blogging service, Weibo, rumoured to be planning a second listing in Hong Kong as soon as this year. The US-listed Weibo, which is backed by Alibaba (9988 HK -1.3%), reported 511 million active users monthly during the third quarter. MEITUAN (3690 HK -1%) TENCENT (700 HK -0.9%) WEIMOB (2013 HK-1.7%) MING YUAN CLOUD (909 HK -3.9%). Baidu results overnight in the US FT’s Lex says it’s struggling against local competitors in terms of advertising and short video but should look for new avenues as its AI and cloud services do well
*TECH & COMPONENTS WEAK as Huawei Tech has told suppliers it only needs enough components for 70m - 80m smartphones this year, that’s about -60% YoY. SUNNY OPT (2382 HK -1.1%) TRULY (732 HK -8%) SIM TECH (2000 HK -3.3%) ASM (522 HK -3.7%). XIAOMI (1801 HK +6.4%) soared over 11% on rumour that it plans to build vehicles, but no comment was made by the co. *TELCOS STRONG after market analysts commented that mainland investors are seeking out laggard stocks, including telcos. They are also good defensive utility plays CH MOBILE (941 HK +6.4%) CH TEL (728 HK +10%) CH UNICOM (762 HK +7%).
*INSURERS FIRM on premium news NCI (1336 HK +2.6%) January gross premium income +12.8% YoY to 34.63b yuan. PICC GROUP (01339.HK +0.8%) announced that the aggregate premiums income for January 2021 ballooned 6.67% yearly to RMB97.985 billion.PICC P&C (02328.HK -0.5%) announced that the original insurance premium income for January 2021 reached RMB53.112 billion, up 1.2% yearly.TAIPING (966 HK +1.7%) CH LIFE (2628 HK +0.8%) PING AN (2318 HK +2.5%).
*HK RETAILERS STRONG on vaccine hopes, as the first batch of 1m vaccine doses arrived in HK today. SASA (178 HK +3.3%) CHOW TAI FOOK (1929 HK +8.1%) BONJOUR (653 HK +5.6%) LIFESTYLE (1212 HK +3%) despite issuing a profit warning at lunchtime.
*HK PROPERTY LANDLORDS STRONG on vaccination hopes CKA (1113 HK +3.3%) SHKP (16 HK +2.5%) HENDERSON (12 HK +1%). WHARF (4 HK +1%) 77/79 Peak Road project, developed and dealt by WHEELOCK (20 HK unch), sold the 77A Peak Road's house and the 77D Peak Road's house at over $590 million and over $550 million, representing a floor price of $80,942 and $88,000, respectively. The developer cashed in more than $1.14 billion in a single day.Wheelock Prop released 68 units in the first price list of Grande Monaco in Kai Tak, at an average price of HK$23,795 psf discounts, about 5% higher than the first price list of the phase 1 of Monaco development. HANG LUNG PPTY (101 HK -0.9%) despite announcing its acquisition from the US Gvot on Shouson Hill had got Beijing Approval.SINO LAND (83 HK unch) plans to offer five new projects for sale this year, apprx 4,680 units.
*AIRLINES FIRM CH SOUTHERN (1055 HK +1.6%) Jan. passenger capacity -51% YoY, passenger traffic -59% YoY. CH EASTERN (670 HK+0.8%) Jan. passenger capacity -50% YoY, passenger traffic -61% YoY. AIR CHINA (753 HK +3%).
Pre market inflation data was better than expected
Nikkei 225 opened lower @ 29,970 as the inflation data was stronger than expected but worked initially higher to traded around 30,100, as Flash PMI data was good. But late morning sold back down to the opening level. PM opened lower and worked slight higher but saw resistance at 30,000 before an uptick at the end to close -218pts (-0.7%) @ 30,018
Topix traded in a similar fashion currently -13pts (-0.7%) @ 1,929
Inflation Rate Jan -0.6 YoY vs -1.2% Dec (F/cast was -1%)
Inflation Rate Jan +0.5% MoM vs -0.3% Dec (F/cast was -0.2%)
Core inflation Rate Jan -0.6% YoY vs -0.4% Dec (F/cast was -0.3%)
Inflation Ex Food and Energy Jan +0.1% YoY vs -0.4% Dec (F/cast was -0.3%)
Flash PMIServices Feb 45.8 vs 46.1 Jan (F/cast was 47)
Manufacturing Feb 50.6 vs 49.8 Jan (F/cast was 50)
Composite Feb 47.6 vs 47.1 Jan (F/cast was 47)
During the showcase of its latest Qashqai model, Nissan announced it will lift the investments in its British plants to more than GBP1 billion in the coming few years as it unrolls greener technology.
Pre market PPI data stronger than forecast, signs of continued foreign and institutional selling on inflation concerns. Local concerns eased as covid cases dropped back below 600, KDCA reported 561 Friday (vs 621 Thursday)
Kosdaq opened flat but after an initial uptick sold down finding support at 945 around 11:30am and then worked higher but hit resistance at 965 -2pt (-0.2%)
Kospi Opened higher and initally trade sideways with Thursday’s closing level being support. But mid morning sold down and found support at 3,040 which it tested a couple of times before working higher to close at the day high +21pts (+0.7%) @ 3,108
PPI Jan +0.8% YoY vs +0.1% Dec (F/cast was -0.1%)
PPI Jan +0.9% MoM vs +0.7% Dec (F/cast was +0.2%
Opened lower following the weakness in the US and despite good local earnings. TSMC was weak. Market trended lower through the morning but found support late morning at 16,210 level and then worked higher to close -83pts (-0.5%) @ 16,341.
Data due tomorrow GDP Growth Rate, Export Orders
Northbound RMB 74,875m Sell 36,537m : 38,338m Buy
Southbound HK$ 32,899m Sell 15,974m : 16,925m Buy
Northbound RMB 80,122m Sell 36,185m : 43,937m Buy
Southbound HK$ 36,732m Sell 17,002m : 19,730m Buy
PING AN (02318.HK) +2.5%
BABA (09988.HK) -1.3%
MEITUAN (03690.HK) -1%
TENCENT (00700.HK) -0.9%
HKEX (00388.HK) +0.3%
AIA (01299.HK) +0.1%
HSI & HSCEI Constituents on Move:
CONCH CEMENT (00914.HK) +9.6%
CHINA UNICOM (00762.HK) +6.9%
CHINA MOBILE (00941.HK) +6.4%
XIAOMI (01810.HK) +6.4%
CSPC PHARMA (01093.HK) +4.5%
CHINA TOWER (00788.HK) +4.2%
MENGNIU DAIRY (02319.HK) +3.7%
CPIC (02601.HK) +3.6%
CONCH VENTURE (00586.HK) +3.4%
CK ASSET (01113.HK) +3.3%
HSMI & HSSI Constituents on Move:
GOME RETAIL (00493.HK) +18.1%
CNBM (03323.HK) +14.7%
HENGTEN NET (00136.HK) -14%
JXR (01951.HK) +13.1%, hitting new high
MCC (01618.HK) +12.4%, hitting new high
SINOFERT (00297.HK) +11.3%, hitting new high
BJ ENERGY INTL (00686.HK) +11.1%
REALORD GROUP (01196.HK) +10.7%, hitting new high
CMBC CAPITAL (01141.HK) -10.5%
COFCO JOYCOME (01610.HK) +10.4%, hitting new high
COMBA (02342.HK) +10.3%
MARKET HOURS NEWS
XIAOMI-W (01810.HK) has stated to make cars as part of its strategic policy, Chinese media LatePost cited sources. The project may be led by founder Lei Jun. Yet the specific form and roadmap remain unsettled, subject to changes. Stock rallied on the rumour.
The daily life of U.S. citizens will hopefully return to "normal" by the end of the year, said Director of the National Institute of Allergy and Infectious Diseases Anthony Fauci, aligning his forecast with a Christmas target lain by President Joe Biden. While the normalisation may come by Christmas, the public will still need to wear masks, opined Fauci.
KUAISHOU-W (01024.HK)'s marketing platform declared a start of commercial content ecosystem rectification on 19 February, where it will focus on the crackdown on irregular marketing content and incentives to high-quality content. The Chinese video-sharing platform will realise the crackdown on a dual "algorithm + manual review" approach and ramp up its penalty efforts, under which serious violators will get their accounts banned.
TENCENT (00700.HK) has secured US$8.3 billion in syndicated loan, far exceeding the initial target of US$6 billion, Chinese media citing insiders. Twelve banks partook in the financing deal. The loan is purportedly meant for general economic purposes.
Apple posted job ads this week seeking wireless system research engineers to explore current and next-generation networks, Bloomberg reported. The hired staff will research and design next-generation wireless communication systems for the use of radio access networks, and partake in sectors and academic forums related to the 6G technology.
In response to Ele.me delivery riders' complaint about strict requirements for Chinese New Year awards, BABA-SW (09988.HK) told Chinese media that the delivery platform has made adjustments corresponding to the feedback and that it will amend the target according to the actual order volume in the future.
TENCENT (00700.HK) via Weishi distributed red pockets to its staff for the working Year of Ox, whereby each worker is entitled to RMB200, receivable under WeChat and QQ, said Chinese media.
GEELY AUTO (00175.HK) is seeking to create a new company to explore product planning, marketing and sales of electric vehicles, a step to depart from the industry convention that EVs are marketed and sold alongside traditional vehicles, Reuters learnt from inside sources.
Macau Financial Services Bureau announced that FY20 recurrent revenue amounted to MOP45.988 billion, down MOP85 billion or 65% yearly, where gaming duty income dived 73.5% to MOP29.808 billion.
LIFESTYLE INT'L (01212.HK) Profit Warning For the year ended 31 Dec 20, the Group is expected to record a net profit of approximately HK$138 million, down 93% from HK$1.891 billion recorded in 2019. The significant year-on-year profit drop was mainly due to, among others, a substantial fall in the Group’s sales and revenue, which was a direct result of the severe adverse impacts from the novel coronavirus (COVID-19) pandemic and its containment measures to the foot traffic as well as reduced operating hours of the stores of the Group during the Year.
The PBoC announced successful issuance of 3-month and 1-year central bank notes, in amount of RMB10 billion and RMB15 billion with interest rates of 2.70% and 2.74% respectively.
Overnight HIBOR last posted at 0.04089%, down for 5 days, according to HKAB. Meanwhile, the 1-Month HIBOR related to mortgage rate last stood at 0.13411%.
The Government is set to announce the latest Budget next Wednesday (24 February), local media cited sources. Under which, the re-issuance of iBond and Silver Bond is expected. iBond and Silver Bond's issuance will scale up, sources said. For iBond, the issuance amount of the new batch is estimated to be more than the final issuance amount of the seventh batch at $15 billion, and the tentative guarantee interest rate is 2%. For Silver Bond, the 65-year-old threshold for subscription will be lowered, with hope of benefiting wider public.
The BIS announced that RMB Real Effective Exchange Rate Index rose 1.18% to 127.84 in January, a new high since March 2016.
PETROCHINA (00857.HK) said its first jointly-built hydrogen refueling station was officially put into operation in Taizicheng, Zhangjiakou, China. The group aims to operate 50 hydrogen refueling stations nationwide in the future.
XIAOMI-W (01810.HK) said it is going to suspend operation of Mi Talk, a multi-platform instant messaging software of the company, owing to business change. The company will shut down the server, after which users will not be able to log in and use the software. The company stressed that it will bend over backwards to render more new services to users.
NYU economist Nouriel Roubini told Bloomberg his ongoing bearish view on Bitcoin, saying that "the Flinstones had a better monetary system than bitcoin”. The cryptocurrency had surged recently "because there is a massive amount of manipulation, pump and dump schemes, spoofing, wash trading, and front running," explained Roubini.
The U.S. Conference Board Measure of CEO Confidence edged up to 73 in a recent survey, hitting a new high since the first quarter of 2004. American business leaders expect to axe fewer jobs in the coming months, the survey also showed.
Baidu founder Robin Li had earlier disclosed that the newly established EV JV with Geely confirmed the CEO and brand. Chinese media cited people within the circle that the JV CEO will be assumed by Mobike co-founder cum former chief technology officer Xia Yiping. The mainland bicycle-sharing company Mobike, founded in 2015, was acquired by MEITUAN-W (03690.HK) in 2019. Eventually, its business was merged into Meituan Bike.
The Government announced today (February 19) that Patrick Li Pak-chuen will take up the post of Director of Broadcasting on March 1, 2021 vice Leung Ka-wing who will leave the service. The agreement between the Government and Leung, which originally will expire in August this year, will be resolved early by mutual consent.
Canada seeks to make Facebook pay for local news content, vowing not to back down if the latter bans users from sharing news on the news feed. Facebook had shut off all Australian news content over Canberra's proposed law requiring social media platforms to pay local publishers for news links.
WHARF HOLDINGS (00004.HK)'s 77/79 Peak Road project, developed and dealt by Wheelock Properties, sold the 77A Peak Road's house and the 77D Peak Road's house at over $590 million and over $550 million, representing a floor price of $80,942 and $88,000, respectively. The developer cashed in more than $1.14 billion in a single day.
U.S. President Joe Biden is directing his administration to review major supply chains, especially those for semiconductors, high-capacity batteries and rare earth metals, according to the documents seen by CNBC. The project will be led by Biden's economic and national security teams.
Russia's smartphone market slowed down in the fourth quarter, with handset shipment slipping to 7.902 million units at a pre-tax value of US$2.236 billion, reported IDC.
The Securities and Futures Commission (SFC) has issued restriction notices to 13 brokers, prohibiting them from dealing with or processing certain assets held in 54 trading accounts, which are related to a suspected social media ramp-and-dump scam involving the manipulation of the market in the shares of a company listed on The Stock Exchange of Hong Kong Limited between September 2020 and November 2020).
The stock is probably Macau E&M (1408) which listed at $1.00 on 11-Sep-2020 and closed at $4.36 on 25-Nov-2020 before crashing 81.9% the next day.
The 13 brokerages are: Celestial Securities Limited, Central China International Securities Co., Limited, China Industrial Securities International Brokerage Limited, China Tonghai Securities Limited, Core Pacific – Yamaichi International (H.K.) Limited, KGI Asia Limited, Kingkey Securities Group Limited, Luk Fook Securities (HK) Limited, Monmonkey Group Securities Limited, Shanxi Securities International Limited, Zeus Securities Limited, Zhongtai International Securities Limited and Zinvest Global Limited.
PRE MARKET HOURS NEWS
At the online G7 summit today, U.S. President Joe Biden will discuss the worldwide response to the coronavirus pandemic and how to rebuild the global economy, as well as the need to invest in collective competitiveness to cope with the hurdles posed by China and climate change, said White House spokeswoman.
Wheelock Properties unveiled the first price list for its Kai Tak project, Grande Monaco, involving 68 flats. The GFA ranged 351-961 sq.ft. for each unit. The selling prices ranged $9.637-30.446 million. Based on the maximum discount of 20.5%, the prices would be $7.662-24.205 million, with an average discounted price per sq.ft. of $23,795.
GOME RETAIL (00493.HK)'s controlling shareholder Wong Kwong Yu had earlier been released by Chinese authority. At the management meeting of the group, Wong voiced his hope to restore the market position of the company in the next 18 months.
WANT WANT CHINA (00151.HK) announced that it had on 18 February repurchased on-market 1.50 million shares, involving $8.8513 million.
Volkswagen is mulling over a spin-off of Porsche for listing, in order to rake in cash for software and electric vehicle project investment, Reuters citing insiders. However, the idea is far from being submitted for board discussions and any listing is impossible in 2021, the source said.
HKEX (00388.HK) sent emails to brokers, seeking their list of clients who had successfully subscribed for NH HEALTH-B (06606.HK)'s IPO shares, a move the industry players deemed as part of regulatory efforts to toughen the crackdown on duplicated subscription applications, local media learnt from market sources. The Exchange required brokers to guarantee adequate measures to turn down duplicated or susceptibly duplicated application and to provide the Exchange with the names and ID numbers of the successful subscribers.
Huawei has informed suppliers that its smartphone component orders would plunge by roughly 60% YoY to 70 million units this year given sanctions from Washington, Nikkei reported.
China's catering industry posted a 358.4% YoY growth in service sales revenue during Spring Festival (11-17 February 2021), returning to pre-epidemic levels and showing a 5.4% rise from that in the 2019 Spring Festival, according to the VAT invoices collected by State Taxation Administration.
CHINA MOBILE (00941.HK) Chairman Yang Jie said the company had commissioned 390,000 5G base stations as of end-2020, providing all prefecture-level cities and some key counties with 5G services, cited by CCTV finance. This year, CHINA MOBILE will keep ramping up investment to basically achieve 5G coverage in all cities above the county level and certain pivotal regions.
CHINA EAST AIR (00670.HK) announced that the number of passengers carried in January 2021 was 5.1417 million, down 49.3% yearly. During the month, the weight of freight carried sank 9.2%.