Oct 21 HK WRAP HSI -184pts T/O +10% DoD and Shorts drop to 16.4%CHINA CSI 300 Closed -1pt (flat) 4,793.
HSI +184pts (+0.8%) 24,754 HSCEI +90pts (+0.9%) 10,077 T/O HK$109.50bn (+10.2% DoD)
EUROPE Markets opened flat but sold down with disappointment at their still being no US stimulus package agreement. Construction and Material stocks weak but Telco’s were +VE on good earnings from Ericsson. Also strong were Randstad and Storebrand. Nestle beat and raised its growth target but the shares were trading lower. Centamin very weak after reported falls in production and sales for the third quarter.
Data UK Inflation data was higher than forecast as was PPI
US Futures opened Dow +50pts but rose to +160pts in Asian time but have pulled back to slightly -VE with S&P and NDX flat with caution over the stimulus package. Netflix weal after results missed after market Tuesday but SNAP rallied on good numbers.
On the card today Biogen, AutoNation, Baker Hughes and Abbott Labs are among the names set to report pre market. After market Tesla, CSX, Las Vegas Sands and Chipotle Mexican Grill due to report.
Data due MBA Mortgage Applications and 30 year Mortgage Rate, EIA Crude and Gasoline Change Report, Beige Book. Speech by Brainard and Mester
opened higher at 4,801 but sold down through the morning to 4,759 around 11am and then a small bounce into lunch. PM has opened flat.Investors cautious over US stimulus and the potential for more US sanctions whilst waiting for Beijing to announce more domestic stimulus. The yuan rose to a 27-month high on USD weakness and with the total net profit for China's SOEs in September hitting a new high while net profits in Q3 grew 34.5% YoY. Banks led the gainers amid yuan's strength and quarterly earnings speculations. Northbound saw net outflows amid profit-taking from recent gains. Companies with USD debt also +VE but Export related names under pressure.
Shanghai Composite Index -3pts (-0.1%) @ 3,325
Shenzhen Component Index -135pts (-1%) @ 13,468
ChiNext Index -40pts (-1.5%) @ 2,700HSI Pre Market Pre maket opened at 24,696 +126pts vs +1pt @ 24,570 ADR’s
with Telcos strong after the China Mobile numbers, E-Commerce +VE too. Cathay Pac opened flat having announced its restructuring plan but Air China rose. Shorts squeezed and market rallied to 24,900 in the first 30 minutes. Then trended lower over the next hour to 24,653 before a small rebound to 24,750 and traded sideways into lunch. PM the market worked higher to 24,850 around 3pm but then eased back over the past hour and ticked lower in the closing auction.Investors continue to hope for a US stimulus plan. Money continues to flow into HK ahead of the Ant and other IPO’s. Concerns still remain over the impact of a global growth slow down due to the rising covid cases in Europe and the US.HONG KONG DATACentre for Health Protection said there were 8 new COVID-19 cases
in Hong Kong today (vs 5 Tuesday) 7 imported 1 unknown origin.SHORT SALES Wednesday 16.4% vs 20.6% TuesdayTop Shorts
Ping An (2318) 34%, CLP (2) 34%, CCB (939) 33%, Mengniu Dairy (2319) 33%, Sinopec (386) 33%, Country Garden (2007) 28%, ICBC (1398) 28%, Sunny Optical (2382) 28%, China Resources Land (1109) 25%.AFTER MARKET NEWS FIRST SERVICE (02107.HK), to be listed tomorrow,
opened at $2.26 in gray market, down 5.8% against the listing price $2.4, and closed at $2.12 in gray market, down $0.28 or 11.7% against the listing price of $2.4, on volume of 29 million shares and turnover of $61.1 million, PhillipMart data showed. Excluding the handling fees, a book loss of $700 was reported per board lot of 2,500 shares.TikTok wrote on its blog post that it pledged to step up efforts in clamping down hateful speech and behavior.
TikTok, having tried to wipe out hate speech and hateful ideologies like neo-Nazism and white supremacy, it is now planning to remove content around neighboring ideologies such as White nationalism and White genocide theory.WUXI BIO (02269.HK)'s October-to-date undelivered orders reached US$10.3 billion
(about HK$79.826 billion), according to the firm's online presentation. The firm projected a growth of over 50% next year, thanks to the coronavirus vaccine and monoclonal antibodies.Li Ka-shing and Victor T K Li, through Li Ka Shing Foundation Limited, acquired a total of 980,000 shares in CK ASSET
(01113.HK) at the average price of HK$37.65, HK$37.545, HK$37.53 and HK$37.188 per share on 15 October, 16 October, 19 October and 20 October 2020 respectively. As a result, the deemed interests of Li Ka-shing and Victor T K Li in CK Asset increased from 35.66% to 35.68%, and from 35.72% to 35.75%, respectively.Spot USD/CNY closed at 6.6575, up 243 bps to a new high in over 27 months.
As at 16:53, USD/CNY climbed 193 bps in the night session. USD/CNH stood at 6.6443, up 186 bps.CHINA UNICOM (00762.HK) announced that for the first three quarters of 2020,
EBITDA amounted to RMB73.7 billion, +0.8% YoY. EBITDA as a percentage of service revenue was 35.5%. The profit amounted to RMB10.824 billion, +10.2% YoY. Mobile billing subscriber ARPU increased by 2.6% YoY to RMB41.6.BYD COMPANY (01211.HK) announced that a controlled subsidiary of the company, and Hino
signed a joint venture agreement on 21 October 2020. Each of the Parties will contribute its 50% of the capital to establish a joint venture company in the PRC in 2021 for development of the commercial BEVs and parts and components of electric vehicles. The Parties plan to launch the commercial BEVs under the brand name of Hino by 2025. Hino is principally engaged in the manufacture of commercial vehicles (trucks and buses) and their engines, and its controlling shareholder is Toyota Motor Corporation.BABA-SW (09988.HK)'s Tmall 11.11 Global Shopping Festival has kicked off at 00:00 am today,
Securities Times reported. Within an hour of the beginning of pre-sale, the number of participants increased by more than a double from the same period last year. Over 300 brands traced pre-sales toppling the full-day amount over a year ago. After ten minutes of pre-sale onset, Taobao's livestreaming promotion recorded a turnover more than that in the full day of last year, up by four times.Centa-Salesman Index (CSI) last stood at 54.05 this week, -0.19 pts weekly,
said Centaline Property. CSI climbed slowly under brisk home market sentiment and a user-oriented market. The index had struggled at 50 last five weeks and at 55 in the recent three weeks, waiting for a breakthrough. The property market will get back on track if CSI surpasses 55 without pullback, they said.China's total consumption ballooned 8.7% MoM in the 2020 National Consumption Promotion Month,
according to Ministry of Commerce's data. Spending on goods RMB2.63 trillion +11.4% MoM and services RMB1.61 trillion, +4.5% MoM.Alipay (Hangzhou) Information Technology a wholly owned subsidiary of Ant Group, grasped a piece of land in Hangzhou at RMB2.699 billion,
Securities Times reported. With a land area of 207,800 sq.m., the parcel is for commercial purpose.Regional MarketsJAPAN
Opened higher at 23,615 and rallied to 23,690 and has traded in that range all day. PM traded sideways until 2:15pm in a tighter range 23,650/23675 and then eased lower into the close to finish +0.3% @ 23,640.
Interesting article in the FT on the strength in the Mothers market, wonders how long that strength can continue.S KOREA
Pre market PPI missed but markets opened higher on US stimulus hopes and are trading sideways
Kospi opened at 2,363 and trading 2,371 to 2,356. Closed 0.5% @ 2,371
Kosdaq opened at 827 traded down into the red at 820 but rebounded to 829 and traded in the range 825 to 830 and closed +0.7% @ 831
Pre market data
PPI Sept +0.1% MoM vs +0.5% Aug (F/cast was +0.7%)
PPI Sept -0.4% YoY vs -0.5% Aug (F/cast was +0.1%)TAIWAN
Opened higher at 12,890 and rallied to 12,942 around 10am. It tested that level a number of times before selling down to 12,885 level and traded sideways until 1pm before selling down into the close. Finished +0.1% @ 12,877CONNECT FLOWS
Northbound Rmb 33,469m Buy 17,244m vs 15,224m Sell
Southbound Rmb 8,,075m Buy 3,477m vs 4,598m Sell
Northbound Rmb 45,699m Buy 25,300m vs 20,398m Sell
Southbound Rmb 8,933m Buy 3,656m vs 5,277m SellActive Heavyweights
MEITUAN (03690.HK) +3.1%
HKEX (00388.HK) +1.2%
CCB (00939.HK) +1.1%
TENCENT (00700.HK) +0.4%
AIA (01299.HK) -0.3%
BABA (09988.HK) +0.3%
PING AN (02318.HK) +0.1%HSI & HSCEI Constituents on the move
WUXI BIO (02269.HK) +11.6%, hitting new high
CHINA UNICOM (00762.HK) +11.1%
CHINA TELECOM (00728.HK) +9.2%
SHENZHOU INTL (02313.HK) +4.4%, hitting new high
CHINA MOBILE (00941.HK) +3.9%
ENN ENERGY (02688.HK) +3.8%
SHIMAO GROUP (00813.HK) -3.7%
MENGNIU DAIRY (02319.HK) +3.1%HSMI & HSSI Constituents on the move
NEXTEER (01316.HK) +13.1%
LI NING (02331.HK) +4.7%, hitting new high
YONGDA AUTO (03669.HK) + 3.2%, hitting new high
HOPSON DEV HOD (00754.HK) +2.1%, hitting new highMarket Commentary*E-COMMERCE MIXED
ALIBABA's (9988 HK +0.5%) Tmall will launch its annual shopping bonanza Single Days sale today, and business owners have higher expectations from thisyear's Singles Day sale as it is the first major shopping festival since the pandemicstarted. Tmall has added 3 more days to the event this year to meet demand; JD.COM(9618 HK +1.6%).
TENCENT's (700 HK +0.7%) Honor of Kings attracted US$240m in revenue inSeptember, topping global mobile games. Its other game, PUBG Mobile, ranked second inglobal mobile games. Its revenue grew 13.3% YoY to over US$198m, other gamers dropped;
ARCHOSAUR GAMES (9990 HK -11.4%) KINGSOFT (3888 HK -3.1%).*TECH & COMPONENTS WEAK
after Sweden banned Huawei Tech and ZTE(763 HK -2.5%) from gaining access to its 5G network, adding to the increasing number ofEuropean govts forcing local telecom companies to shift away from Chinese suppliers. AAC(2018 HK -2.1%) BYDE (285 HK -2.5%) SMIC (981 HK -2.4%).*TELCOs STRONG
CH MOBILE's (941 HK) revenue +4.1% YoY to 184.5b yuan for the 3 months to September. Sector also surged after the three major operators have obtained eSIMservice approvals. According to the website of the MIIT, on October 19, the Ministry of Industry and Information Technology approved China Mobile and China Telecom to develop eSIM technology application services in the Internet of Things and other fields.*AIRLINES FIRM
CATHAY PACIFIC (293 HK+2.3%) to cut 8,500 jobs globally inrestructuring and closes Dragon Air brand. Restructuring to cost HK$2.2b. It plans to cut monthly cash burn by HK$500m in 2021. CEA (670 HK +3%) CSA (1055 HK +2.8%) AIR CHINA(753 HK +1.5%) all traded higher as the yuan strength continues.*AUTO DEALERS
remaind strong on recovery hopes. ZHONGSHENG's (881 HK +5.9%) new car sales backlog of new car sales orders reportedly recorded an increase of 80% YoY the Golden Week. YONGDA (3669 HK +3.2%) GRAND BAOXIN (1293 HK +4.6%).*VACCINE FIRM
attracted renewEd buying interests. Wuxi soars as much as 16% aftermgmt said the firm has signed a Covid vaccine deal which could be worth as muchas US$400m while its Covid-related service backlog is at $528m. CANSINO (6185 HK +6%) INNOVENT (1801 HK +3.4%) SINOPHARM (1099 HK +4.3%).