HSI +320pts (+1.1%) 29,962 HSCEI +215pts (+1.8%) 11,949 T/O HK$300.27bn (flat DoD)
Markets opened higher FTSE eased back tor trade around flat but DAX and CAC working higher. UK inflation doubled in December despite the social distancing measures.Tech leading the gains and Utilites the decliners.Logitech higher in early trades after Morgan Stanley, Citigroup and JPMorgan all raised their price targets for the stock.
Pearson and fashion house Burberry trading higher after reassuring trading updates. Diploma higher after reporting a surge in revenue.
Core Inflation Rate Dec +0.2% YoY vs +0.2% Nov (F/cast was +0.2%)
InflationRate Dec -0.3% YoY vs -0.3% Nov (F/cast was -0.3%)
InflationRate Dec +0.3% MoM vs -0.3% Nov (F/cast was +0.3%)
PPI Dec +0.8% MoM vs +0.2% Nov (F/cast was +0.2%)
PPI Dec +0.2% YoY vs -0.5% Nov (F/cast was -0.4%)
Inflation Rate Dec +0.6% YoY vs +0.3% Nov (F/cast was +0.6%)
Inflation Rate Dec +0.3% MoM vs -0.1% Nov (F/cast was +0.2%)
Core Inflation Rate Dec +1.4% YoY vs +1.1% Nov (F/cast was +1.2%)
Core Inflation Rate Dec +0.3% MoM vs -0.1% Nov (F/cast was +0.1%)
PPI Core Output Dec +1.2% YoY vs 1% Nov revised (F/cast was +1.1%)
PPI Core Output Dec +0.1% MoM vs +0.1% Nov revised (F/cast was +0.1%)
Retail Price Index Dec +1.2% YoY vs +0.9% Nov (F/cast was +1%)
Retail Price Index Dec +0.6% MoM vs -0.3% Nov revised (F/cast was +0.5%)
PPI Input Dec +0.2% YoY vs -0.3% Nov revised (Consensus was +1%)
PPI Input Dec +0.8% MoM vs +0.4% Nov revised (Consensus was +0.7%)
PPI Output Dec -0.4% YoY vs -0.6% Nov revised (F/cast was -0.7%)
PPI Output Dec +0.3% MoM vs +0.3% Nov revised (F/cast was +0.1%)
Futures opened slightly +VE in Asian time but eased back during the session to flat, currently moving higher with Dow +40pts, S&P and NDX +VE
CHINA CSI 300 Closed +38pts (+0.7%) @ 5,478
Opened flat but rallied to 5,496 mid morning before selling back down into lunch. PM opened higher but sold down to 5,437 (Tuesday’s closing level) before rebounding and working higher into the close. Still seeing stock rotation, ChiNext strong as investors rotate into Rare Earth names after China introduced a draft bill to exert more control over the sector. Yellen’s testimony taken as a signal that Trump’s tough approach to China will be maintained by the Biden administration.
Shanghai Comp +17pts (+0.5%) @ 3,583
Shenzhen Comp +219pts (+1.5%) @ 15,223
ChiNext Index +120pts (+3.9%) @ 3,205
CHINA DATA Loan Prime Rates were left unchanged as expected
1 year rate @ 3.85% and 5 year @ 4.65%
HSI Pre Market Pre Market Opened @ 29,794 +152pts vs -9pts ADR’s
Market initially sold down to 29,700 but then rebounded to 29,985 level which is tested several times before selling down into lunch. PM opened higher and worked higher to test the 30,000 level. Signs of rotation into names that will benefit from inflation as Yellen commits to more stimulus. HK still seeing strong southbound fund flows.
E Commerce names strong but weakness in Telco’s, Insurance and MTRC after profit warning.
HONG KONG DATA
Centre for Health Protection said there were 77 new COVID-19 cases in Hong Kong today (vs Tuesday) 37 of unknown origin.
SHORT SELLING Wednesday 20.5 vs 16.8% Tuesday
Top Shorts: Hengan (1044) 38%, Ping An (2318) 33%, Baba -SW (9988) 32%, Wharf REIC (1997) 32%, Country Garden (2007) 31%, MTRC (66) 30%, China Res Land (1109) 29%, WH Group (288) 27%, Henderson Land (12) 27%, Tencent (700) 27%, Hang Seng Bank (11) 24%.
AFTER MARKET NEWS
CHINA UNICOM (00762.HK) announced that it had over 270 million 4G users in December 2020, with a net addition of 1.123 million. For the whole of last year, 4G users net added 16.415 million.
SA SA INT'L (00178.HK) announced that, for the third quarter ended 31 December 2020, retail and wholesale turnover. decreased by 36.4% year-on-year to HK$938 million. Same store sales in the Hong Kong and Macau SARs decreased by 45.5% year-on-year.
The inactivated vaccine developed by Sinopharm's CNBG is broadly protective against all COVID-19 strains worldwide, according to data from the pharma's vice-president Zhang Yuntao.
Baidu (BIDU.US) has tapped Goldman Sachs and CITIC as sponsors and planned to lodge an application after Chinese New Year for its planned secondary listing in Hong Kong, said Chinese media.
Centa-Salesman Index (CSI) last printed at 57.08, +3.37 pts weekly.
While the second-hand property market deals are turning vibrant, the index is set to reclaim 60, opined the research department of Centaline Property. Home prices will regain uptrend if it successfully hits the target 62.59.
*PETROCHEMS MIXED, as IEA cut its oil demand outlook by 600,000 barrels a day for the current quarter. But OPEC+ cuts will help drain 100m barrels from inventories, keeping the market on track for a strong recovery in 2H. CNOOC (883 HK +0.6%) PETROCHINA (857 HK -0.4%) CH OILFIELD (2883 HK +0.9%) SINOPEC (386 HK -0.7%).
*E-COMMERCE FIRM as ALIBABA (9988 HK +8.5%) but off intraday highs of 10% on the new that Jack Ma emerges in a video conference with rural teachers, first time he’s been seen since the Govt crackdown on ANT. TENCENT (700 HK +3.7%) JD.COM (9618 HK +3.7%) WEIMOB (2013 HK +13%) NTES (9999 HK +3.3%).
MEITUAN (3690 HK +8.8%) is amongst bidders for the US$2b China logistics Property Holdings Ltd. deal to takeover of China's third-biggest modern warehouse operator, news said.
RAZER (1337 HK +7.9%) issued a positive profit warning saying it expects to breakeven in FY2020.
*TECH & COMPONETS MIXED component makers remain firm amid shortage in global chips and components supply shortage. BYDE (285 HK +9.7%) ASM PACIFIC (522 HK +5.9%) Q TECH (1478 HK +5%) FIT HONG TENG (6088 HK +21%).
*AUTOS STRONG on EV optimism. China's Zhejiang Geely Holding Group, GEELY AUTO's (175 HK +5.8%) parent, yesterday said it has signed an agreement with TENCENT to develop smart vehicle cockpit and autonomous driving. BYD (1211 HK +4.2%) GAC (2238 HK +1.3%), GREAT WALL (2333 HK +3.3%).
ZHENGTONG AUTO (1728 HK +2.5%) says the syndicate behind its $415m loan has unanimously indicated their agreement to extend the facility’s repayment arrangement to July 19, 2022 as proposed by Zhengtong. The repayment amounting to about $259m will be made in five installments between Jan 2021 and Jul 2022.
*PHARMA STRONG as vaccines continued to be rolled out. CANSINO (6185 HK +7%) is expected to seek approval for emergency use of its Covid-19 vaccine by the end of this week, Mexico’s Foreign Minister said. FOSUN (2196 HK +2.2%) SINO BIOPHM (1177 HK +5.6%) WUXI BIO (2269 HK +5.5%). INNOVENT (1801 HK +6.9%) initiated as OUTPERFORM at HTI amid improving R&D capabilities.
*HK PROPERTY MIXED HK unemployment hit its highest level since 2004 is a concern and could hurt sentiment although primary sales continue to show buying strength. SWIRE PROP (1972 HK -1.3%) CKA (1113 HK -1.8%) SHKP (16 HK -1.4%) HANG LUNG PT (101 HK +2.4%) SINO LAND (83 HK +1.1%).
*WIND POWER PROVIDERS STRONG National Energy Admin said today that China added almost 72 gigawatts of wind power in 2020, more than double the previous record. CH LONGYUAN (16 HK +13%) GOLDWIND (2208 HK +7.8%) DATANG RENEWABLE (1798 HK +14.7%).
MTRC (66 HK -2.5%) after profit warning; it expects to have recorded a net loss of around HK$4.8b last year.
ZOOMLION (1157 HK +3.6%) received approval from China CSRC to sell additional 193.8m new H-shares.
Market opened higher following the rally on Wall Street but sold down though the morning and early afternoon to a low of 28,400 before working slightly higher to close -110pts (-0.4%) @ 28,523
Topix followed a similar pattern to close -6pts (-0.3%) @ 1,850 No data but covid cases continuing to rise a concern.
Nidec Corp said on Wednesday it had filed a patent infringement lawsuit against Seagate Technology LLC and its affiliates, accusing it of using Nidec hard disk drive motor designs without permission.
Kospi opened higher but sold down after the first 20 minutes to 3,080 before effectively then trading sideways around yesterday’s closing level. Slight rally in the last hour to close +22pts (+0.7%) @ 3,115
Kosdaq opened higher and worked higher to lunch and then traded sideways; closed +20pts (+2.1%) @ 978
Kia strong on news its looking at electric car projects with multiple firms. Tech also seeing continued interest.
Opened higher but trended lower through the day to a low of 15,750 around 1pm before an uptick into the close -71pts (-0.5%) @ 15,806
Dec Export Orders +38.3% YoY vs +29.7% Nov (F/cast was +25% YoY)
Northbound Rmb 54,726m Buy 28,041m vs 26,684m Sell
Southbound HK$ 43,844m Buy 18,528m vs 25,316m Sell
Northbound Rmb 64,547m Buy 29,898m vs 34,649m Sell
Southbound HK$ 42,833m Buy 14,666m vs 28,167m Sell
MEITUAN (03690.HK) +9.1%, hitting new high
BABA (09988.HK) +8.5%
TENCENT (00700.HK) +3.7%, hitting new high
AIA (01299.HK) -3.4%
HKEX (00388.HK) +1.2%
PING AN (02318.HK) -0.4%
HSI & HSCEI Constituents on Move:
ALI HEALTH (00241.HK) +17.1%
JD HEALTH (06618.HK) +15.4%
SINO BIOPHARM (01177.HK) +5.7%
GEELY AUTO (00175.HK) +5.6%
WUXI BIO (02269.HK) +5.2%, hitting new high
CHINA OVERSEAS (00688.HK) +4.9%
CSPC PHARMA (01093.HK) +4.5%
CPIC (02601.HK) -4.4%
ANTA SPORTS (02020.HK) -3.8%
JD (09618.HK) +3.3%
NTES (09999.HK) +3.3%
HAIDILAO (06862.HK) +3.1%CHINA TOWER (00788.HK) -3.1%
CHINA GAS HOLD (00384.HK) -3.1%
SHENZHOU INTL (02313.HK) +1.6%, hitting new high
HANSOH PHARMA (03692.HK) +0.6%, hitting new high
HSMI & HSSI Constituents on Move:
SIHUAN PHARM (00460.HK) +43.5%, hitting new high
FIT HON TENG (06088.HK) +23%
CSSC SHIPPING (03877.HK) +20%, hitting new high
WEIMOB INC (02013.HK) +15.5%, hitting new high
PEIJIA (09996.HK) +14.7%
NEXTEER (01316.HK) +13.3%, hitting new high
CHINA LONGYUAN (00916.HK) +12.9%, hitting new high
VENUS MEDTECH (02500.HK) +11.8%
AKESO (09926.HK) +11.6%, hitting new high
AK MEDICAL (01789.HK) +11.2%
PHARMARON (03759.HK) +11.2%, hitting new high
MING YUAN CLOUD (00909.HK) +11%, hitting new high
IGG (00799.HK) +11%
BYD ELECTRONIC (00285.HK) +10.7%, hitting new high
C TRANSMISSION (00658.HK) +10.2%
MARKET HOURS NEWS
CHINA SCE GROUP (01966.HK) plans to spin off its property management business for HK IPO this year that may raise roughly US$300 million or HK$2.34 billion, IFR learnt from insiders.
SMARTONE TELE (00315.HK) and Route 3 (CPS) Company Limited announced the application of a 5G smart transportation management system, the first-of-its-kind system for Hong Kong road tunnels and highways, at the Tai Lam Tunnel
BYD Semiconductor has received the pre-listing tutoring from CICC, having filed tutoring reports with Shenzhen Securities Regulatory Bureau recently, reported Chinese media.
HSBC HOLDINGS (00005.HK) and Malayan Banking’s insurance venture Etiqa are among suitors for AXA’s Singaporean business in a deal that may amount to US$700 million, Bloomberg reported.
Since the implementation of the "Return2hk Scheme" on November 23, 2020 until January 18, 2021, over 32,000 persons (about 560 persons per day on average) have returned to Hong Kong under the Scheme, said Secretary for Constitutional and Mainland Affairs Erick Tsang.
BABA-SW (09988.HK) announced that it has started merchant recruitment for the proposed local business-to-consumer (B2C) service, "Tmall Hong Kong", which will be rolled out within months. Based on Taobao Hong Kong's existing e-commerce experience, BABA-SW anticipated to help local merchants open up stores in a fast and efficient manner.
BABA-SW (09988.HK) Founder Jack Ma, who had not showed himself up for a while after Ant Group's listing hit impasse, attended a teacher award ceremony via online conference, meeting 100 rural teachers in China, mainland media covered. This was the first time Ma made public appearance in more than two months.
CHINA MOBILE (00941.HK) announced that it had 165 million 5G package customers in December 2020, representing a net addition of 17.621 million monthly, decelerating from the 18.589 million in November 2020.
HKICPA assumed the Government to record $348 billion in FY20/21 deficit, a new record high and way beyond $139.1 billion in official forecast. The institute advised the Government to ponder over new taxable items, which may take several years to complete public consultation, consensus agreement and legislation.
Volkswagen AG's head of China operations Stephan Wollenstein foretold a slide by tens of thousands units in sales volume across the country as its production was impacted by a global chip supply shortage last December.
Overnight HIBOR last posted at 0.03955%, according to HKAB. Meanwhile, the 1-Month HIBOR related to mortgage rate last stood at 0.10929%, marking a 1-month low.
Midea has entered into cooperation with TENCENT (00700.HK)'s Game for Peace, whereby small home appliances will be introduced to the players, such as pans, air fryers and convenient cups.
TENCENT (00700.HK)'s Tencent Cloud announced the strategic partnership with Siemens Digital Industries Software, where Siemens' Mendix low-code platform will make inroads into China for the first time. Both parties will cooperate to accelerate the development of low- /zero-code application development and cloud-based rapid application development, and achieve seamless integration of business and IT.
Xiamen Kaimen Jianjun Film And TV Industry Investment Partnership Enterprise (Limited Partnership) was founded yesterday with a registered capital of RMB10.22 million, Chinese media citing Tianyancha. The firm's executive partner is an affiliate of BABA-SW (09988.HK) The company is backed by BABA-SW and iQIYI.
The U.S. posted a MoM net capital inflow of US$214.1 billion for November 2020, according to data from the Treasury Department. China boosted US$9 billion U.S. bonds in the month, where the bond holding totaled US$1.063 trillion.
The Hong Kong Monetary Authority (HKMA) encouraged the public to use electronic channels for giving lai-see. The public may use the HKMA’s Faster Payment System available via online or mobile banking, or other e-wallet services, instead of giving red packets of cash. The HKMA's current stock of new notes is twice the amount of new notes issued in the previous CNY, while the stock of good-as-new notes is three times as big. Furthermore, the duration of the notes exchange service will be extended from two weeks as in previous years to three weeks, i.e. from 26 January (Tuesday) to 11 February 2021 (Thursday). As such, there is no need to rush to bank branches for new notes in the first few days.
PRE MARKET NEWS
The Government will gazette the specifications under the Prevention and Control of Disease (Regulation of Cross-boundary Conveyances and Travellers) Regulation (Cap. 599H) to restrict persons who have stayed in Brazil or Ireland from boarding flights for Hong Kong. Under the relevant specifications, all persons who have stayed in Brazil or Ireland for more than two hours on the day of boarding or during the 21 days before that day will not be allowed to board for Hong Kong; persons arriving at Hong Kong who have stayed in Brazil or Ireland on the day of arrival at Hong Kong or during the 21 days before that day have to present before boarding a negative result proof of a nucleic acid test for COVID-19 conducted within 72 hours before the scheduled time of departure of the aircraft and confirmation of room reservation in a designated quarantine hotel, and (irrespective of arriving at Hong Kong via the airport or land boundary control points) have to undergo compulsory quarantine for 21 days in designated quarantine hotels.
Law Chi-kwong, Secretary for Labour and Welfare, told media that the higher unemployment rate of Hong Kong was well-expected given the peak of fourth wave of plague in last December coupled with the end of Employment Subsidy Scheme. As past story told, more businesses will shut down after Chinese New Year. Law therefore was not upbeat about the unemployment in the next 1-2 months.
The People's Bank of China (PBOC) today carried out seven-day RMB280 billion reverse repos in the open market. There will be RMB2 billion reverse repos due today. The single-day net investment reached RMB278 billion.
HSBC HOLDINGS (00005.HK) plans to cut 82 British branches this year, reported foreign media. There will be 511 branches left in the country, a majority of which will be remodeled while some will offer fewer services.
Blackstone, MEITUAN-W (03690.HK), ESR (01821.HK) and JD-SW (09618.HK)'s JD Logistics are vying for the controlling stake in CNLP (01589.HK) at a transaction cost as high as US$2 billion (approximately HK$15.5 billion), foreign media reported.
AKESO-B (09926.HK) announced that the latest study of Penpulimab (research and development code: AK105), an anti-PD-1 monoclonal antibody drug co-developed by the Company and SINO BIOPHARM (01177.HK) in combination with Anlotinib for treatment of 1L advanced hepatocellular carcinoma (HCC) has been published at the Gastrointestinal Cancers Symposium 2021. According to the study, the combination of Penpulimab and Anlotinib is safe and tolerable, and has demonstrated encouraging anti-tumor activity for treatment of 1L advanced HCC patients.
CH MODERN D (01117.HK) announced planned placing of 650 million shares at the Placing Price of HK$2.40 per Placing Share, representing a 12.09% discount to the closing price yesterday. The expected net proceeds approximate HK$1.552 billion.
PBoC Survey on Urban Savers showed 23.3% people in China preferred "more consumption" in 4Q20, down 0.2 ppts quarterly. 51.4% of them leaned towards "more savings", up 1 ppt quarterly, and 25.3% tended to have "more investment", down 0.8 ppts quarterly. The three investment methods mostly preferred by Chinese residents in pecking order were: "banks, securities, insurance company's wealth management products", "fund trust products" and "stocks". The proportions of residents who chose these three methods were 47.3%, 24.9% and 17.3%, respectively.
In 2020, China's per capita disposable income of residents doubled from 2010, as Chinese media cited National Bureau of Statistics. During the year, the per capita disposable income of residents was RMB32,189, a nominal increase of 4.7% over the previous year.
Xiao Yaqing, Ministry of Industry and Information Technology, stressed at a meeting that NEV promotion and application will have to be ramped up this year, with vehicle electrification rolling out in public space. China will mount a new round of NEV-buying subsidy in rural areas, he added.
A live broadcast entrance will be introduced in the next WeChat iteration, revealed Allen Zhang, Senior Executive Vice President of TENCENT (00700.HK) and President of WeChat Business Group, as cited by The Beijing News. The app may launch live New Year Greetings during the Spring Festival, he added.
In 2020, China registered online retail sales of physical goods at RMB9.8 trillion, an increase of 14.8% bucking the trend, accounting for 24.9% of the total retail sales of consumer goods, as Xinhua News Agency learned from the Ministry of Commerce. China has become the world's largest online retail market for eight straight years.
CASH FIN SER GP (00510.HK) announced that it had on 19 January disposed an aggregate of 537,000 CHINA MOBILE (00941.HK) shares on the open market for an aggregate consideration of $27.2 million and an expected book gain of approximately $2.4 million.