Dec 11 HK WRAP HSI +95pts off initial high but China sells off


11 Dec

HSI +95pts (+0.4%) 26,506 HSCEI +37pts (+0.4%) 10,453  T/O HK$135.91bn (+23.6% DoD) 

EUROPE Markets opened and trended lower on the expectation of a non deal Brexit and doubts about a US stimulus package.
Germany
Inflation Rate Final Nov -0.3% YoY vs -0.2% Oct (F/cast was -0.3%)
Inflation Rate Final Nov -0.8% MoM vs +0.1% Oct (F/cast was -0.8%)

US Futures opened Dow +20pts but initially rose but have dropped to -200pts  as a Stimulus package looks unlikely and investors are awaiting the FDA final approval for the emergency vaccine use as covid cases continue to rise.
Data due
PPI, Core PPI, Michigan Consumer Prelim Data (Sentiment, Expectations, Current Conditions, Inflation Expectations, 5 year Inflation Expectations) Baker Hughes Total Oil Rig Count.
Fed Speaker Quarles

CHINA CSI 300 Closed  -51pts (-1) @ 4,890
Opened higher at 4,958 but trended lower through the morning session to 4,867 at lunch. PM saw the market open slightly higher but drift lower to 4,850 around 2:30pm and then work better into the close. Investors continue to worry about further sanctions from Trump before he leaves office.
Indexes
Shanghai Comp -26pts (-0.8%) @ 3,347
Shenzhen Comp -176pts (-1.3%) @ 13,555
ChiNext Index -31pts (-1.1%) @ 2,688

CHINA DATA today
Vehicle Sales Nov 12.6% YoY vs 12.5% Oct (F/cast was +11.5%)
Monday we get China House Price Index and could FDI data.

HSI Pre Market Opened @ 26,634 +224pts vs +156pts ADR’s.
Initial ticked lower but then rallied to test 26,700 but failed to break out then sold down to 26,445 level before a small bounce into lunch. PM saw the market initially traded higher but resistance as it approached 26,550 having tested a couple of times it sold down to the day low, 26,440 level before working back to test 26,530 level but failed to break above and eased into the close.

IPO
POP MART (09992.HK), settled the trade at $4.59, up 0.7% against the listing price, on turnover of $88.308 million. A book gain of $30 was reported per board lot of 1,000 shares.
DATANG GROUP (02117.HK), settled the trade at $4.59, up 0.7% against the listing price, on  turnover of $88.308 million. A book gain of $30 was reported per board lot of 1,000 shares.
PICKs Techtronics (669 HK) closed +0.5% @ HK$103.50. Having opened at 105.00 level.  I would look to accumulate if it dips below HK$100.

HONG KONG DATACentre for Health Protection said there were 86 new COVID-19 cases in Hong Kong today (vs 112 Thursday) 37 cases with unknown origin with more infections in Housing Estates.

SHORT SELLING Friday 12.9% vs 14% Thursday 
Top Shorts  Country Garden (2007) 46%, NWD (17) 41%, Bank of China (3988) 34%, Hang Seng Bank (11) 33%, Anta Sports (2020) 28%, Ping An (2318) 29%, Wharf REIC (1997) 28%, Sunny Optical (2382) 27%, CKI (1038) 27%, HSBC (5) 26%.

AFTER MARKET NEWS 
SINO BIOPHARM (01177.HK)  announced that Senior Vice Chairman Tse Ping had today acquired 15 million shares of the company, involving roughly $100 million.
CPIC (02601.HK)  announced that the primary insurance premiums of China Pacific Life Insurance and China Pacific Property Insurance, both of which are the subsidiaries of the Company, for the first eleven months of 2020 amounted to RMB202.6 billion and RMB136.026 billion, down 1.9% YoY and up 12.8% YoY, respectively.
S HARBOURHOLD (01663.HK) announced that the chairman and substantial shareholder, Wong Lam Ping, acquired an aggregate of 850,000 shares, involving $119,000.
DA MING INT'L (01090.HK) positive profit alert. For the eleven months ended 30 November 2020, the Group is expected to record an increase in net profit of over 40% as compared with that of the same period in 2019.
CHINA LIFE (02628.HK) accumulated premium income of the Company for the first eleven months of 2020 was about RMB586.2 billion, up 8.29% yearly.
HUANXI MEDIA (01003.HK)  announces that its “huanxi.com” has entered into a strategic cooperation agreement with Huawei and a cooperation agreement with XIAOMI-W (01810.HK) respectively and formally effected the cooperation in respect of the video broadcasting business.
NCI (01336.HK) announced that the accumulated gross premium income for the period between 1 January 2020 and 30 November 2020 was RMB152.57 billion, up 17.2% yearly.
Centa-City Leading Index (CCL) last posted at 177.75, up 1.26% weekly to a nine-week high. Centaline Property, analyzed that the index level pointed to an overall passionate sales of new properties with brief price spike, but did not imply an upturn. As the reading this week has not factored in the Policy Address and the fourth wave of plague, housing prices were expected to keep juggling.
CCL (large units) last printed at 171.98, up 0.33% weekly;
CCL Mass last stood at 181.42, up 1.43% weekly;
CCL (small-and-medium units) last reported at 178.84, up 1.42% weekly.

Regional Markets
JAPAN 
Nikkei 225 Opened slightly lower saw a small pop to 28,000 but then sold down to 26,550 level before trending slightly higher into lunch. PM saw the market grind slightly higher to close -104pts (-0.4%) @ 26,653
Topix Opened higher and tested to 1,785 before selling down to 1,771 and then trading sideways into lunch. PM saw the market open lower but worked higher to close +6pts (+0.3%) @ 1,782
Monday we get Tankan survey pre market and later we get Industrial Production, Capacity Utilisation and the Tertiary Industry Index.
S KOREA  
Data showed Exports +26.9% YoY in the first 10 days of December giving the market a +VE boost
Kospi Opened higher and rallied to 2,774. Then traded sideways 2,764/2,781 until 1pm after which it traded around the 2,770 level to close +24pts (+0.9%) @ 2,770 Kosdaq Opened higher rallied to 927 and then sold down to 923 before rebounding and trading sideways 925/928 after 1pm it moved higher and traded arounds 928 to close +7pts (+0.7%) @ 928
TAIWAN opened higher at 14,300 and initial ticked up to 14,353 but then trended lower to 14,080 before finding support and then worked better for the rest of the session to close flat, +12pts (+0.1%) @ 14,261

CONNECT FLOWS (up DoD)
Shanghai 
Northbound Rmb 50,654m Buy 25,831m vs 24,823m Sell
Southbound HK$ 12,764m Buy 6,728m vs 6,036m Sell
Shenzhen 
Northbound Rmb 56,286m Buy 29,623m vs 26,663m Sell
Southbound HK$ 10,550m Buy 4,894m vs 5,656m Sell

Active HeavyweightsMEITUAN (03690.HK)  +2.4%
PING AN (02318.HK) -2%
TENCENT (00700.HK) +1.7%
BABA (09988.HK) +1.2%
AIA (01299.HK) -0.3%
CCB (00939.HK) unchanged

HSI & HSCEI Constituents on Move:
CNOOC (00883.HK) +6.1%
SINOPEC CORP (00386.HK) +4.5%
GEELY AUTO (00175.HK) +3.8%
LONGFOR (00960.HK) -3.3%

HSMI & HSSI Constituents on Move:
GCL-POLY ENERGY (03800.HK) +14.6%
JIUMAOJIU (09922.HK) +5.7%, hitting new high
HAITIAN INT'L (01882.HK) +3.4%, hitting new high
XINYI GLASS (00868.HK) +2.2%, hitting new high

MARKET HOURS NEWS
Chief Executive Carrie Lam said the Government has struck deals with two COVID-19 vaccine makers, including Sinovac Biotech. The pharma will offer 7.5 million doses, with the first 1 million shots arriving in Hong Kong as early as January 2021. Another 7.5m doses will be supplied by FOSUN PHARMA (02196.HK), BioNTech and Pfizer, to be delivered as soon as the first quarter of 2021.
Govt: 36 Hotels Designated for Quarantine with Over 12K Rooms, Incl. Landmark Mandarin Oriental, Sheraton
Local home prices are set to slip less than 2% this year, gentler than 5% in earlier estimate, mainly attributable to the pent-up purchase power in the previous year, said Thomas Lam, Executive Director, Head of Valuation & Advisory at Knight Frank. Citing the different economic keystone between the current pandemic and 2003's SARS, Lam forecast a U-shaped rebound unlikely for the property market.
MediaTek is now exploring with the U.S. Department of Commerce the resumption of shipment to Honor, although it remains unknown for now if Honor V40 will adopt MediaTek's flagship chips, Chinese media reported.
China's auto sales volume hit 2.77 million units in November, +7.6% MoM and 12.6% yearly, according to data from China Association of Automobile Manufacturers (CAAM). NEV sales volume hit 200,000 units, +24.1% monthly and 104.9% yearly.
Wang Yi, Minister of Foreign Affairs of the PRC, delivered a speech at a seminar in Beijing that China and US should rebuild a healthy and sturdy strategic development framework for the fundamental interests of people of both nations and mutual benefits of the world, summarizing the cooperation experience since the diplomatic relation was established and learning lessons from the rock-bottom relationship of both countries in recent years.
Shangri-la plans to dismiss 100 employees from Island Shangri-la, Kowloon Shangri-la, Kerry Hotel and Hotel Jen, as Hong Kong Hotel Employees Union learnt from the staffers.
NEXT DIGITAL (00282.HK)  Founder Jimmy Lai Chee-ying was additionally charged with collusion with foreign powers and crime of endangering national security, of which case will be taken to the court tomorrow (12 December), local media quoted sources.  Lai had previously been charged with fraud crime together with two other NEXT DIGITAL's executives. He was then remanded without bail.
XIAOMI-W (01810.HK) has lodged several applications for trademark "Lei Jun", involving metallic materials, musical instruments, etc..
Moody's reported the stable earnings and capital position of Chinese life insurers, adding their premium growth rebound will support a sturdy sector outlook development next year. The profitability of life insurers will be backed by solid interest margin, furthered Moody's.
President of Geely Auto Group, disclosed that the automaker is working hard on the R&D of the next-generation hybrid system, where the thermal efficiency will topple any product available on the market, auto.caijing.com.cn reported.  Other Chinese automakers also planned to raise the thermal efficiency, for example GREATWALL MOTOR (02333.HK), which had claimed their efficiency of regular and hybrid engines will reach 41% and 42% in 2022, before roaring to 51.5% in 2025.
Hong Kong Airlines this morning dismissed 250 cabin crew members under the catastrophic blow from the pandemic, said local media.
FOSUN PHARMA (02196.HK) and Sinopharm Logistics held a contract signing ceremony in Shanghai regarding the delivery of COVID-19 vaccine - BioNTech mRNA.  Both parties will commence cooperation in vaccine product storage, distribution and supply chain services nationwide in China. On top of the logistics strategic cooperation, SINOPHARM and FOSUN PHARMA specified the coordination in cold chain logistics this time around.
A Brazilian production line for the COVID-19 vaccine of China's Sinovac Biotech has come into operation.  Sao Paulo Governor Joao Doria said Butantan Institute, the state's biomedical center, plans to make 1 million vaccine doses per day to prepare for a vaccination program starting 25 January. Butantan's head Dimas Covas said multiple Latin American countries, including  Peru, Uruguay, Paraguay and Honduras, are interested in buying vaccine shots from Brazil. Each shot will cost US$10.3 only, far below the prices of vaccines made by European and US pharmas.
XIAOMI-W (01810.HK)'s Mi Watch Lite hit the shelves on Xiaomi's global site, sharing lots of similarities with the Redmi Watch launched last month. The Mi Watch Lite is equipped with a 1.4" color display and a square-shaped screen. The watch offers a nine-day battery life and 11 sports modes.
Tricor Group announced to team up with HSBC for the launch of Tricor IPO. Smart Pay as supported by HSBC’s real-time direct debit solution.  IPO Smart Pay is a new feature for Tricor's white form e-IPO APP, offering a fast and secured payment method for IPO applications.
China's auto sales volume may hit 24.5 million units for 2020, -5% YoY, 
predicted China Automobile Dealers Association (CADA).
PRE MARKET NEWS
Not in this mornings report
HSBC HOLDINGS (00005.HK)  announced that it intends to issue US$1.5 billion (approximately HK$11.627 billion) 4.6% Perpetual Subordinated Contingent Convertible Securities. The Securities are expected to be admitted to the Official List and to trading on the Global Exchange Market of The Irish Stock Exchange plc trading as Euronext Dublin within 30 days of the Issue Date.  The net proceeds from the issuance of the Securities are expected to be US$1.485 billion (approximately HK$11.511 billion).
CG SERVICES (06098.HK) announced planned placing of 173 million shares at a placing price of $45 per share, representing a 9.46% discount to the closing price yesterday.  The estimated net proceeds were $7.745 billion.
Some Chinese provinces convened a seminar in Hangzhou, Zhejiang to conclude antitrust work results, according to State Administration for Market Regulation (SAMR).  During which, the participants made a profound analysis of the new landscape, missions and requirements, while exploring and deploying the antitrust work for the 14th five-year period.
China Mobile and Tianjin Municipal Government sealed a strategic cooperation agreement, under which the former will continue to scale up the investment in the construction of communications infrastructure in Tianjin, as Securities Times learnt from CHINA MOBILE (00941.HK). The telecom planned to invest approximately RMB12 billion during the 14th Five-Year Plan period.
CHINA RES LAND (01109.HK) for the month ended 30 November 2020, the Group achieved gross contracted sales of approximately RMB28.94 bn +10.7% YoY with contracted GFA of approximately 1.6043 million square meters, +10.4% YoY.
COWELL (01415.HK)  announced that the substantial shareholder Kwak Joung Hwan transferred 44.87% equity interest of the company to the independent third party Luxvisions Innovation Technology (as offeror), involving 374 million shares, for a consideration of $2.196 billion.  Upon completion, the purchaser would hold 44.87% share capital of the company, and the Offeror will be required to make a mandatory conditional cash offer for all the issued Shares at $5.87, representing a premium of 2.98% over the closing price as quoted before trading halt. The Offeror intends to finance the total consideration of the Acquisition and Offers of up to $2.723 billion. It will resume trading today.
PICC P&C (02328.HK) announced that the original insurance premium income amounted to RMB398.916 billion, up 1.1% yearly, for the period from 1 January 2020 to 30 November 2020.
PICC GROUP (01339.HK)  announced that pursuant to the PRC Accounting Standards, the aggregate premiums income as derived from the operating subsidiaries PICC P&C, PICC Health and PICC Life for the first eleven months of 2020 were RMB398.916 billion, RMB90.384 billion and RMB30.623 billion, respectively.  The total amount was RMB519.923 billion, up 2% year-on-year.

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