HSI -180pts (-0.7%) 26,499 HSCEI -62pts (-0.6%) 10,483 T/O HK$166.47bn (+29.1%)
Saw a weak open but markets initially trended higher into the green before trading sideways around flat. German Ifo data was better than f/cast +VE UK calls on EU to compromise or no deal -VE for sentiment. US FDA approved Moderna’s vaccine. Travel and Leisure weak, Telcoms +VE. US stimulus in focus with hopes of a deal.
Current Account Oct Euro 34.1b vs 33.5b (F/cast was 36.3b)
PPI Nov +0.2% MoM vs +0.1% Oct (F/cast was +0.2%)
PPI Nov -0.5% YoY vs -0.7% Oct (F/cast was -0.5%)
Business Climate Dec 92.1 vs 90.9 Nov revised (F/cast was 90)
Expectations Dec 92.8 vs 91.8 Nov revised (F/cast was 92.5)
Current Conditions Dec 91.3 vs 90.0Nov (F/cast was 88.9)
Consumer Confidence Dec -26 vs -33 Nov (F/cast was -30)
Retail Sales Nov -3.8% MoM vs +1.3% Oct revised (F/cast was -2.8%)
Retail Sales Nov +2.4% You vs +5.8% Oct (F/cast was +3.2%)
Retail Sales Ex Fuel Nov -2.6% MoM vs +1.4% Oct revised (F/cast was -2%)
Retail Sales Ex Fuel Nov +5.6% YoY vs +7.8% Oct (F/cast was +6.5%)
CBI Industrial Trends Orders Dec -25 vs -40 Nov (F/cast was -27)
Opened Dow flat (+5pts) but eased lower to -44pts, but now indicate flat S&P and NDX also flat. Stimulus deal in focus and the Fed Bank Stress tests. +VE sentiment on Monderna’s vaccine being approved.
Current Account, CB Leading Index, Baker Hughes Oil Rig, Fed Bank Stress Test Results Second Round.
CHINA CSI 300 Closed -18pts (-0.4%) @ 5,000
CSI 300 opened lower but traded around flat for the morning session. PM sold down to 4,979 and then worked better for the next hour back to 5,006, but then drifted lower into the close.
Monday on the open we get the China Loan Prime Rate.
Shanghai Comp -9pts (-0.3%) @ 3,394 T/O Rmb354b
Shenzhen Comp -35pts (-0.3%) @ 13,854 T/O Rmb 417.2b
ChiNext Index -4pts (-0.2%) @ 2,780 T/O Rmb152.9bn
HSI Pre Market Opened at 26,650 -28pts vs -68pts ADR’s
but saw selling pressure and trended lower finding support at 26,360 and then traded sideways with resistance around the 26,500 level. PM saw some initial selling as China sold down support around 26,400 and then effectively traded sideways into the close and then saw an 83pt uptick in the closing auction.
Ecommerce and Chinese Financial names weak but Coal, Petrochems and Renewable energy names +VE as Southern China has to ration electricity amid insufficient power supply. Renewable energy names also saw a number of broker upgrades. SMIC -5% continues to be under pressure.
VESYNC (02148.HK), finished the day at $8.8, up $3.28 or 59.4% against the listing price of $5.52, on volume of 274 million shares, involving $2.475 billion. Excluding the handling fees, a book gain of $3,280 was reported per board lot of 1,000 shares.
JACOBIO-B (01167.HK), to be listed next Monday, opened at $16.48 in grey market, up 17.7% against the listing price $14, and last stood at $20.9, up 49%, on volume of 1 million shares, PhillipMart data showed.
PICKs Techtronics (669 HK) closed +0.6% @ HK$107.40. Good news from US house builders likely to continue to drive the stock. I would wait a look to accumulate below HK$100.
HONG KONG DATA
Centre for Health Protection said there were 70 new COVID-19 cases in Hong Kong today (vs 96 Wednesday) 25 cases with unknown origin.
SHORT SELLING Friday 16.6% vs 15.2% Thursday
Top Shorts Country Garden (2007) 36%, Wharf REIC (1997) 36%, Hang Lung Ppty (101) 35%, Bud Apac (1876) 35%, NWD (17) 33%, Ping An (2318) 33%, Baba-SW (9988) 31%, Hang Seng Bank (11) 30%, Sino BioPharm (1177) 26%, Bank of China (3988) 25%, MTRC (66) 25%.
AFTER MARKET NEWS
SWIREPROPERTIES (01972.HK) announced the cooperation with SINO-OCEAN GP (03377.HK) to develop the sites in vicinity of Indigo, Beijing as an extension to the project. The expansion project, in an expected investment size of RMB23 billion, will be held as to 35% and 64.79% by SWIREPROPERTIES and SINO-OCEAN GP.
EVERGRANDE (03333.HK) acquired 1.04 million shares, 2.845 million shares, 3.276 million shares, and 3.17 million shares of EVERG VEHICLE (00708.HK) from Tuesday (15th) until today (18th), involving about $296 million in total, according to HKEX's disclosure of interests.
MEITUAN-W (03690.HK) to bolster its leadership hierarchy building further by establishing a unit for middle-level and top-level management development. The division will be headed by the group's Co-founder Mu Rongjun In the meantime, MEITUAN-W Co-founder and Senior Vice President Wang Huiwen will officially step down.
S HARBOURHOLD (01663.HK) announced that Wong Lam Ping, the Company’s chairman and substantial shareholder, had acquired 884,000 shares in the open market on 18 December, involving $132,600.
The Central Harbourfront commercial land parcel, located at the heart of Hong Kong with Victoria Harbour views, sounds very appealing to developers, opined Dorothy Chow, senior director of valuation and advisory at JLL. However, she foresaw rather conservative prices offered by developers under an office and retail market downcycle. Centaline Commercial estimated the floor price of the Central Harbourfront commercial land king at around $38,000, with a land premium of about $61.1 billion.
The two-envelope tender of Site 3 of the New Central Harbourfront will close on June 18, 2021.
BABA-SW (09988.HK) In response to foreign media report that Chinese joint investigation unit is probing into the group, stated that the news is untrue and that it will hold the rumourmongers accountable.
Li Ka-shing and Victor T K Li, through Li Ka Shing Foundation Limited, acquired a total of 690,000 shares in CK ASSET (01113.HK) at the average price of HK$42.9529, HK$42.25, HK$41.7933 and HK$41.1937 per share on 14 December, 15 December, 16 December and 17 December 2020 respectively. As a result, the deemed interests of Li Ka-shing and Victor T K Li in CK Asset increased from 35.85% to 35.86%, and increased from 35.91% to 35.93%, respectively.
HK to tighten arrival restrictions in view of the global developments and severity of the COVID-19 pandemic situation, to include Canada as a specified place starting from December 25 to more effectively combat the epidemic, said the Food and Health Bureau.According to the latest specifications, a traveller who, on the day on which the traveller boarded a civil aviation aircraft that arrives at, or is about to arrive at, Hong Kong (specified aircraft), or during the 14 days before that day, has stayed in one of the aforementioned specified places must provide negative test results for COVID-19 and confirmation in English or Chinese of room reservation in a designated quarantine hotel/guesthouse in Hong Kong.
CBHB (09668.HK announced that the net profit amounted to RMB6.55 billion during the first nine months of 2020.
Shenzhen Yilite Entertainment a wholly-owned subsidiary of Tencent Music, was incorporated today with a registered capital of RMB5 million, according to TianYanCha. The arm is engaged in artistic and literary creation
Tencent Music announced that a consortium, which is led by TENCENT (00700.HK), exercised its call option to acquire an additional 10% equity interest in Universal Music Group (UMG) from France's Vivendi, at the same enterprise value of EUR30 billion as in the initial acquisition that closed in March 2020.
Airport Authority Hong Kong has communicated with suppliers to collaborate on transporting the first COVID-19 vaccine shots, which are expected to arrive in January 2021. The authority aims to deliver the vaccine at the earliest convenience. AAHK has roughly 30 refrigerated trucks, each capable of storing 150,000-300,000 vaccine doses.Centa-City Leading Index (CCL) last posted at 176.54, down 0.68% weekly. For the recent nine weeks, CCL +0.4%, CCL Mass +0.3%, CCL (small-and-medium units) +0.4%.
The reading indicated the first weekly condition after the 4th COVID-19 outbreak, said the research department of Centaline Property.
Nikkei 225 opened slightly lower as pre market inflation data missed. Tested yesterday’s closing level a number of times but failed to break above and eventually sold down into lunch. PM opened lower and trading sideways but around 2pm took another dip lower to 26,720 but then rebounded to close -43pts (-0.2%) @ 26,763
Topix opened lower but worked back into the green for most of the morning but sold down in lunch. PM opened lower tests 1,790 before rallying back into the green but sold off around 2pm down to 1,787 before bouncing back to close +1pt (flat) @ 1,793
Data pre market
Inflation Rate Nov -0.9% YoY vs -0.4% Oct (F/cast -0.5% MoM)
Inflation Rate Nov -0.5% MoM vs -0.1% Oct (F/cast -0.2% MoM),
Core Inflation Nov -0.9% YoY vs -0.7% OCt (F/cast -0.8% YoY),
Later BoJ Interest Rate Decision; no change as expected and announced a 6 month extension to special programme.
Kospi opened flat and has traded sideways in a tight range 2,782/2,763 to close +2pts (flat) @ 2,772
Kosdaq Similar trading pattern range 943/948 and closed at the top end +3pts (+0.3%) @ 947
Opened higher and spiked to 14,329 around 10 am but then sold back down to flat and worked sideways. Then around 12:30pm dropped in the red and traded sideways again Closed -9pts (-0.06%) @ 14,250
On Monday after market we get Export Orders
CONNECT FLOWS (up DoD)
Northbound Rmb 46,803m Buy 22,448m vs 24,355m Sell
Southbound HK$ 13,011m Buy 7,362m vs 5,648m Sell
Northbound Rmb 53,230m Buy 28,250m vs 24,981m Sell
Southbound HK$ 12,536m Buy 5,839m vs 6,697m Sell
MEITUAN (03690.HK) -2.3%
PING AN (02318.HK) -2%
BABA (09988.HK) -0.9%
TENCENT (00700.HK) -0.5%
CCB (00939.HK) +0.2%
HSI & HSCEI Constituents on Move:
SMIC (00981.HK) -5.2%
CHINA UNICOM (00762.HK) +3.4%
CHINA MOBILE (00941.HK) +3.2%
CSPC PHARMA (01093.HK) -3.1%
HSMI & HSSI Constituents on Move:
ZHAOJIN MINING (01818.HK) +15.3%
YIXIN (02858.HK) +14.8%, hitting new high
MCC (01618.HK) +11.4%
REDCO GROUP (01622.HK) -10.3%
TIANGONG INT'L (00826.HK) +10.2%
DONGYUE GROUP (00189.HK) +9.7%, hitting new high
MAN WAH HLDGS (01999.HK) +8%, hitting new high
XINYI SOLAR (00968.HK) +7.9%, hitting new high
GREATWALL MOTOR (02333.HK) +7%, hitting new high
MARKET HOURS NEWS
BABA-SW (09988.HK) stated that it never allows or intends to use its technology for targeting or identifying specific ethnic groups, after a report alleged that its facial recognition software can pick out Uighur minorities, cited Reuters.
Baidu (BIDU.US) may join hands with Weltmeister for car-making, Chinese media citing sources. Both sides are in talks on possible cooperation modes.
The Trump administration is set to add roughly 80 enterprises, including SMIC (00981.HK) -1.090 (-5.203%) into the Commerce Department's entity list on Friday (local time), Reuters learnt from people familiar with the matter. The blacklisted enterprises, most of which are Chinese firms allegedly tied to the Chinese military like Huawei, will be subject to curbed access to U.S. technology.
CHINESE EST H (00127.HK) announced that the disposal of up to $8 billion debt securities to the substantial shareholder Chan Hoi-wan had been completed today before the deadline.
CKH HOLDINGS (00001.HK) announced that the proposal to sell its interest in European tower assets to Cellnex has been passed at the extraordinary general meeting with 99.89% votes in favour.
The residential site at no. 2, 4, 6 and 8, Mansfield Road, the Peak, whose tender has closed at noon, has received at least seven tenders as at 12:00, including SHK PPT, CK ASSET (01113.HK), K. WAH INT'L (00173.HK) and HENDERSON LAND (00012.HK), according to on-site witness.
Singapore Exchange (SGX) plans to debut rebar futures contract against Mysteel's Shanghai rebar index next year, reported Bloomberg. The contract will purportedly be denominated in U.S. dollar, poised to be launched in the first quarter of 2021.
Overnight HIBOR last posted at 0.04893%, according to HKAB. Meanwhile, the 1-Month HIBOR related to mortgage rate last stood at 0.28%, marking a 1-month high.
League of Legends: Wild Rift, the mobile version of the blockbuster, has been installed by 12.5 million times since its debut, amassing US$10.5 million in revenue, according to Sensor Tower's report.
The U.S. Treasury Department is planning to water down President Donald Trump's blacklist of Chinese firms, which restricts American investment in firms tied to the Chinese military, reported Financial Times. See my FT Thoughts today.Huawei will invest EUR200 million in creating a mobile phone network equipment plant in the east of France, with an initial headcount of 300. The workforce will be increased to 500 in the longer term.
In addition to Zhejiang, China's government authorities have issued notices in several regions like Hunan, Inner Mongolia and Jiangxi to put forward measures on tight electricity supply, according to Securities Times. Power supply in these regions has purportedly been restricted by turning off power brakes.
Ant Group has removed the internet deposit products from its ant platform under relevant industry regulations, reported Beijing Business Today, although product holders will remain unaffected.
XINYI SOLAR (00968.HK) On 14 December, BlackRock disposed of 13.986 million shares in the market, involving roughly $188 million, according to shareholding disclosures at the Stock Exchange.
PRE MARKET NEWS
The Government stated that it will ensure the relevant clinical research data of the procured coronavirus vaccines fulfil the safety and efficacy requirements scientifically after having been assessed by experts and that the quality assurance of the vaccine must be well-supported in order for the vaccine to be approved for emergency use in Hong Kong. The Government is now conducting emergency legislative work for introducing coronavirus vaccines proven to be safe and effective into Hong Kong.
The State Council published a notice on certain policies on promoting high-quality IC and software sector buildout in the new era. Accordingly, any IC manufacturer or project with the linewidth of less than 28nm (inclusive) and an operating period of over 15 years, shall be exempted from corporate income tax for the first ten years starting from 1 January 2020.