Aug 21 HK WRAP HSI +323pts @ 25,114, Shorts remain elevated
HSI +323pts (+1.3%) 25,114 HSCEI +56pts (+0.5%) 10,212 T/O HK$118.12bn (unch DoD)
EUROPE Markets open slightly higher following Asia and the US but then trade around flat after the PMI flash data showed Eurozone weaker, Germany mixed , France weaker and UK stronger. UK Retail Sales were stronger and Public sector borrowing was less than expected but CBI Industrial Trends orders missed.
US Futures opened +32pts, climbed to +100pts intraday but then came off and are currently +28pts. S&P slightly -VE and NDX was flat.
Data due tonight Flash PMI data, Existing Home Sales, Baker Hughes Total Rig Count
CSI 300 Closed +40pts (+0.9%) @ 4,719 opened higher at 4,720 level and has effectively traded slightly higher in the AM session to 4,734 at lunchtime. PM saw the market sell down to 4,685 (just above Thursday’s closing level before bouncing into the close.
Shanghai Composite Index +0.5% @ 3,380.
Shenzhen Component Index +1.2% @ 13,478.
ChiNext +1.7% @ 2,632
HSI Market Opened +216pts @ 25,007 vs +58pts ADRs (24,849) E Commerce +VE except Alibaba, Financials +VE too. Initially traded sideways but now working higher; currently +1.1%. In the PM session the index traded sideways around the 25,100 level.
Financials, and Macau names were all higher; E commerce were mixed.
EARNINGs due Monday include Yuexiu Property (123.HK), Guangdong Land (124.HK), Tingyi (Cayman Islands) (322.HK), Qingdao (499.HK), China Overseas Land & Investment (688.HK), i-CABLE (1097.HK), China Modern Dairy (1117.HK), Harbin Electric (1133.HK), AAC Tech (2018.HK), West China Cement (2233.HK), Guangzhou R&F Properties (2777.HK), CITIC Securities (6030.HK)
EARNINGS OUT After market
SUN.KING ELEC (580.HK) interim results for the period ended June 2020. Turnover +9.6% YoY to RMB688 million. The net profit RMB91.65 million, -18.9% yearly. EPS was RMB5.69 fen. An interim dividend of HK2 cents was declared.
CONCH CEMENT (914.HK) interim results ended June 2020. Revenue +3.3% YoY to RMB74.007 billion. Net profit RMB16.069 billion, +5.3% yearly. EPS equaled RMB3.03. No dividend was declared.
BRILLIANCE CHINA (1114.HK) interim results for the period ended June 2020. Turnover -23.9% YoY to RMB1.45 billion. The net profit amounted to RMB4.045 billion, +25.2% yearly. EPS was RMB0.80178. No dividend was declared.
PICC GROUP (1339.HK) interim result ended June 2020. The net profit amounted to RMB12.606 billion, -18.6% yearly. EPS was RMB0.29. An interim dividend of 3.6 fen was declared.
SHENZHEN EXPRESS (548.HK) interim results for the period ended June 2020. Turnover -37.7% YoY to RMB1.687 billion. The net profit amounted to RMB43.9229 mn -97.2% yearly. EPS was RMB0.02. No interim dividend was declared.
HAITONG INT'L (665.HK) interim results for the period ended June 2020. Turnover -13.2% YoY to HK$3.553 billion. The net profit amounted to HK$521 million, -49.8% yearly. EPS was HK8.9 cents. A dividend of HK4.4 cents was declared.
MEITUAN-W (3690.HK) interim results ended June 2020. The company swung into net profit of RMB631 million from loss of RMB554 million over a year ago, vs brokers' forecast for loss of RMB1.078-3.419 billion. Revenue -1% yearly to RMB41.476 billion. EPS equaled RMB0.38.
1H20 Non-IFRS Adjusted NP +463% to RMB2.502B
FUYAO GLASS (3606.HK) interim results for the period ended June 2020. Turnover -21.1% YoY to RMB8.121 billion. The net profit amounted to RMB964 million, down 36% yearly. EPS was RMB0.38. No dividend was declared.
CHINA HONGQIAO (1378.HK) interim results for the period ended June 2020. Turnover -3.6% YoY to RMB39.939 billion. The net profit amounted to RMB2.832 bn +14.3% yearly. EPS was RMB0.33. An interim dividend of HK15 cents was declared, against no dividend in the year-ago period.
LVGEM CHINA (95.HK) interim results for the period ended June 2020. Turnover -28% YoY to RMB2.462 billion. The net profit amounted to RMB37.556 million, -96.2% yearly. EPS was RMB0.74 fen. No dividend was declared.
DURING MARKET HOURS
AVICHINA (2357.HK) interim results ended June 2020. Revenue rose 11.1% year on year to RMB20.198 billion. Net profit amounted to RMB740 million, up 15.9% yearly. EPS equaled RMB0.1186. No dividend was declared.
LOGAN GROUP (3380.HK) interim results ended June 2020. Revenue rose 14.9% yearly to RMB31.035 billion. Net profit amounted to RMB6.157 billion, up 20.1% yearly. EPS equaled 110.28 fen. Interim DPS was HK43 cents.
CHINA STATE CON (3311.HK) interim results ended June 2020. Revenue rose 1.7% year on year to HK$28.002 billion. Net profit amounted to HK$2.898 billion, up 1.3% yearly. EPS equaled HK57.39 cents. Interim DPS was HK17 cents.
HOPSON DEV HOLD (754.HK) interim results ended June 2020. The net profit amounted to HK$5.102 billion, up 92.2% yearly. EPS was HK$2.292. An interim dividend of HK$0.6 was declared, against HK$0.1 in the corresponding period of the previous year.
AGILE GROUP (3383.HK) interim results for the six months ended 30 June 2020. The Group’s revenue RMB33.527 billion, +23.7% YoY. Net profit RMB5.127 billion, +1% YoY Earnings per share was RMB1.321. The core net profit was RMB6.518 billion, representing a year-on-year increase of 35.6%. The Company’s board of directors declared an interim dividend of HK50 cents per share.
SITC (1308.HK) interim results ended June 2020. Net profit amounted to US$119 million, up 9.9% yearly. EPS was US4.46 cents. An interim dividend of HK22 cents was declared.
SOHO CHINA (410.HK) interim results ended June 2020. Net profit amounted to RMB204 million, down 63.9% yearly. EPS equaled 4 fen. No dividend was declared.
Out PRE MARKET
MIDEA REAL EST (3990.HK) results for the six months ended June 2020. Net profit was RMB2.024 billion, up 14.4% yearly. EPS equaled RMB1.64. No interim dividend was declared.
BANK OF JINZHOU (416.HK) interim results ended June 2020. It recorded a net profit of RMB407 million, compared with loss of RMB999 mn over a year ago. EPS was 5 fen. No interim dividend was declared.
KAISA PROSPER (2168.HK) interim results ended 30 June 2020. Net profit grew 31.4% yearly to RMB119 million EPS equaled 84.69 fen. No interim dividend was declared.
SINOPEC KANTONS (934.HK) results for the six months ended June 2020. Net profit amounted to $610 million, down 16.1% yearly. EPS equaled 24.53 cents. Interim DPS stayed flattish at 8 cents.
COMBA (2342.HK) interim results announcement for the six months ended 30 June 2020. Revenue decreased by 18.6% yearly to HK$2.238 billion. Net profit decreased by 35.4% yearly to HK$53.14 million. Earnings per share was HK2.09 cents. Interim dividend was HK0.7 cents per share, versus HK1 cent per share over a year ago.
AFTER MARKET NEWS
Pinduoduo (PDD.US) Q2 2020 unaudited financial results. The Non-GAAP adjusted net loss trimmed to RMB77.241 million from net loss of RMB411 million over a year ago, beating the market expected loss of RMB1.517 billion. Net loss per ADS was RMB0.75, whilst non-GAAP net loss per ADS was RMB0.06. The stock was -12.4% to US$85.05 in pre-trading.
Sinopharm's CNBG posted on Weibo that it held a contract signing ceremony with Morocco yesterday (20 August) in regards of cooperation in COVID-19 vaccine, following approvals in UAE and Peru for clinical trials. This marked another milestone of the company, demonstrating the full-swing acceleration of its international clinical trials.
AGILE GROUP (3383.HK) announced that its 1H20 pre-sales amounted to RMB55.1 bn. Chairman Chen Zhuo Lin disclosed that sales will be accelerated in 2H20, confident of achieving the full-year sales target of RMB120 billion. The company will be highly cautious about its future land acquisition strategy, the chairman added, underscoring the company will not resort to M&A blindly and may retain capital for appropriate opportunities next year.
GCL-POLY ENERGY (3800.HK) PROFIT WARNING -VE the Group expected to incur a net loss of not less than RMB1.5 billion for the six months ended 30 June 2020 as compared to the net loss of approximately RMB751 million for the corresponding period last year.
GCL NEW ENERGY (451.HK) PROFIT WARNING -VE The Group is expected to record a net profit of not more than RMB200 million for the six months ended 30 June 2020 as compared to the net profit of approximately RMB571 million for the corresponding period last year.
The tender invitation for a site, Lot No. 1003 in Demarcation District No. 214 at Hiram's Highway near Ho Chung, Sai Kung, closed at 12pm today. At least 22 bids were received for the site. CK ASSET (1113.HK), SINO LAND (83.HK), WING TAI PPT (369.HK), EMPEROR INT'L (163.HK), GRAND MING (1271.HK) and Chinachem submitted bids on a sole basis.
Other bidders included NEW WORLD DEV (17.HK), K. WAH INT'L (173.HK), FE CONSORT INTL (35.HK), CHEVALIER INT'L (25.HK) , KINGBOARD HLDG (148.HK) and K&K Property.
HK Government said in early July, the Chinese government had given green light to the scheme for inbound and outbound travel to Mainland with health codes, although the scheme hit snags from ups and downs in coronavirus situation, said Chief Executive Carrie Lam. However, travels may be resumed under the scheme once the pandemic stabilizes.
Asked about some political parties' proposal that the public must present a health code before entering shopping malls, the city leader stated that the information may have been distorted as the Government has never considered such ideas and accentuated that it is unfeasible and unfair for residents to show a health code before entering public premises.
Centa-City Leading Index (CCL) last printed at 180.90, +0.18% weekly. This marked the end of CCL's three-week decline, with the index standing firmly at 180 for four weeks.
CCL Mass lifted 0.11% weekly to 184.37.
CCL (small-and-medium units) gained 0.14% weekly to 181.49.
CCL (large units) ascended 0.40% weekly to 177.85.
Centaline Property said it showed that the second-hand deals were boosted by showroom visit resumption in wake of easing epidemic. Entering September, the housing price trend was expected to become more certain.
Market and Pre Market News at bottom of page.
JAPAN opened higher as inflation data came in higher than forecast and initially rallied to 23,130 level but then trended lower as the Flash PMI data came out and was lower than expected. The trend lower continued into lunch. PM market re-opened higher buttoned lower to finish just off the day low @ 22,920 +0.2%
S KOREA opened higher but sold down initially as pre market PPI was lower than expected and covid concerns remain elevated. Kosdaq opened at 801 and found support around the 780 level, small bounce and then trading sideways,Around mid day the market rallied back to the opening level but then dipped again to close +0.6% @ 796.Kospi opened higher at 2,306 and followed the same pattern as the Kosdaq to close +1.3% @ 2,304
TAIWAN opened higher and has trended higher through the session. Good export data out after market Thursday helping; closed +2%
Short Selling HSI Friday 20.7% vs 23.9% Thursday
Top Shorts CLP (2) 47%, Ping An (2318) 47%, Sino Land (83) 41%, Mengniu Dairy (2319) 40%, HSBC (5) 37%, BOC (3988) 37%, Sunny Optical (2382) 37%, Power Assets (6) 36%, CCB (939) 34%, Want Want (151) 34%, Shenzhou (2313) 34%, Hang Lung Ppty (101) 31%, China Res Land (1109) 31%, Sinopec (386) 30%, BOC HK (2388) 30%, HK & China Gas (3) 29%, CKI (1038) 28%, CITIC (267) 27%, Country Garden (2007) 26%.
CONNECT FLOWS (lighter DoD)
Northbound Rmb 40,913m Sell 20,839m : 20,074m Buy
Southbound HK$ 10,877m Sell 5,344m : 5,533m Buy
Northbound Rmb 57,439m Sell 27,774m : 29,665m Buy
Southbound HK$ 9,780m Sell 4,160m : 5,620m Buy
Centre for Health Protection said there were 27 additional COVID-19 cases in Hong Kong today; (vs 18 cases Thursday). 7 with unknown origins
AIA (1299.HK) +4%
TENCENT (700.HK) +2%
HKEX (388.HK) +1.5%
PING AN (2318.HK) +0.4%
HSI & HSCEI Constituents on the move
SANDS CHINA LTD (1928.HK) +6.5%
GALAXY ENT (27.HK) +6.2%
ENN ENERGY (2688.HK) -4.4%
WHARF REIC (1997.HK) +3.7%
CHINA UNICOM (762.HK) +3.1%
HSMI & HSSI Constituents on the move
SIHUAN PHARM (460.HK) +17%
HOPSON DEV HOLD (754.HK) +10.2%, hitting new high
BOC AVIATION (2588.HK) +10.1%
AK MEDICAL (1789.HK) +10.1%
C&D INTL GROUP (1908.HK) +8.3%, hitting new high
C TRANSMISSION (658.HK) +6.7%, hitting new high
MEIDONG AUTO (1268.HK) +6.6%, hitting new high
Pfizer (PFE.US) said the regulatory review for the COVID-19 vaccine co-developed with BioNTech will be conducted as early as October. On Thursday, Pfizer published more research data on the vaccine, which is undergoing the second and third round of tests in the U.S. and Germany respectively.
HKMA, the Hong Kong Institute for Monetary and Financial Research (HKIMR) and other collaborators jointly conducted a research project on the adoption of artificial intelligence (AI) in banking. Over 80% of participating banks view AI adoption as a way of improving efficiency and strengthening risk management, according to the report. Banks are also optimistic about the prospects of using AI, with some 80% of survey respondents planning to increase investment in AI over the next 5 years.
Chief Executive Carrie Lam reminded the public to stay patient as the toughest anti-pandemic measures of the year are in place, and the Government will keep an eye on the trend of confirmed case numbers in the week ahead. While the virus test among ferry pier and foreign domestic helper clusters will hopefully be completed soon, the targeted clusters will be further enlarged to screen the symptom-free patients in the community.
Staying in touch with caterers and other players affected by the lockdown measures, the city leader disclosed that the Government may start from relaxation of dinnertime dine-in services and orderly re-opening of cinemas, beauty parlors and fitness centers. As discussion is underway with the cosmetic sector about business resumption schedule, a timetable may be pinned down in the coming week.
JD-SW (9618.HK) has published a notice on sellers' forum, requesting merchants to stop using several courier companies including IDC (002468.SZ) (STO EXPRESS) and to switch to other suppliers, or else the normal shipment will be affected, 21st Century Business Herald reported. Merchants at JD's platform said they would still be able to choose STO EXPRESS as the courier but it would not be possible to track logistics information after August 31st 2020. JD-SW said it is not fair that its request to tap its logistics division onto BABA-SW (9988.HK)'s e-commerce platform has not been addressed by BABA-SW, which is the substantial shareholder of STO EXPRESS, JD stated.
Pre-orders for Nintendo Switch's "Ring Fit Adventure" are exclusively available at the flagship store of JD-SW (9618.HK), where the game has been sold out in a day with pre-orders reaching 31,500 sets, Mainland media reported. "Ring Fit Adventure", which was introduced to China by TENCENT (700.HK), has a suggested retail price of RMB499.
In 2019, over US$50 billion of cryptocurrency outflow from China's digital wallets to other places across the globe, when Chinese citizens are only allowed to purchase foreign currency from financial institutions up to US$50,000 each year, Chainalysis reported. Wealthy Chinese citizens have turned to cryptocurrency to transfer their capital overseas as the Chinese economy suffered different levels of blow in the past year.
Official Receiver's Office announced that the number of petitions presented for bankruptcy declined 18.51% monthly to 722 in July, showing a monthly fall for the second straight month.
One month after cinemas have been re-opened in Mainland China, national box office as at August 20th surpassed RMB1 billion with viewer number being 33.39 million, market data showed. The movie that made the most contribution to box office was The Eight Hundred (八佰)".
According to a survey by the Hong Kong General Chamber of Commerce (HKGCC), 36% of respondents said their turnover had plunged by at least half, compared to pre-Covid-19 levels. Almost half (42%) of SMEs and a quarter (24%) of large corporations surveyed fear they will only be able to survive for up to six months due to the ongoing Covid-19 crisis without further relief measures from the Government. The survey showed that SMEs are suffering the most, with 60% of companies who have seen turnover drop by half being SMEs, compared to 29% for large companies.
The Urban Renewal Authority (URA) announced to extend the rent relief for its domestic and commercial tenants in its properties, as well as the commercial tenants in its joint ventured shopping malls, for another three months. The URA’s rent relief measures announced earlier till the end of September will be continued until the end of December 2020 in a bid to assist URA’s tenants in the face of current economic challenges and support employment over difficult times.
TSMC (TSM.US) announced that it has manufactured its one-billionth good die on its defect-free 7nm chips. The technology entered mass production in April 2018. The Taiwan-based tech giant has manufactured 7nm chips for well over 100 products from dozens of customers.
Ant Group's application for overseas IPO, including issues of ordinary shares, preference shares and other equities, was accepted by China Securities Regulatory Commission (CSRC), according to the CSRC official website. Ant Group has valuation target of US$225 billion for its listing plan in Hong Kong and China, according to market sources. The company aims to raise US$30 billion in the IPO in Hong Kong and Shanghai. It was known that Ant Group may submit its IPO applications in Hong Kong and Shanghai within weeks, and plan to float on the stock markets as early as October.
SIHUAN PHARM (460.HK) announced that the principal findings of Group’s completed post-launch clinical trials on ‘‘Cinepazide Maleate Injection (Kelinao)’’ for the treatment of acute ischemic stroke have recently been published in BMC Neurology, a journal of neurology under the BMC Journal Group in the United Kingdom. The successful publication of the results of the Studies confirms the Drug being so far the first among all the acute ischemic stroke treatment drugs available nationwide to have completed large-scale post-launch randomized controlled trial (RCT) verification studies and taken the lead to disclose, in an international SCI journal, its efficacy of improving the prognosis and lowering the disability rate of stroke patients.
Macao Government Tourism Office (MGTO) has partnered with UnionPay International to promote information about travel and special offers to travelers via the “Macao Ready Go!” online platform. With the Office’s support, UnionPay International also leverages a confluence of online and offline promotional offers to attract visitors for vacation and shopping in Macao, in turn contributing to revival of local tourism activities.
SSY GROUP (2005.HK) announced that the it’s Cefdinir Capsules and Prucalopride Succinate Tablets, both being new products, were both awarded the first place in the tender results of National Centralized Medicines Procurement in the PRC on 20 August 2020.
TENCENT (700.HK) announced that it entered into an agreement with Chengdu Municipal Government, whereby both parties will commence strategic cooperation in new cultural creation and smart city. TENCENT will establish its new cultural creation headquarter in Chengdu with a total investment of RMB5 billion, focusing on game development, e-sports, animation, video, cultural tourism and so on.
Macao Information from the Statistics and Census Service (DSEC) indicated that, attributable to the adjustment of the quarantine measures, number of visitor arrivals in July 2020 surged by 2.3 times month-to-month to 74,006; however, a year-on-year decline of more than 90% was still recorded. Same-day visitors and overnight visitors totaled 50,210 and 23,796 respectively. The average length of stay of visitors went up by 0.1 day year-on-year to 1.3 days.
People's Bank of China is to carry out a RMB200-billion reverse repos today by way of interest rate tender. This comprises of a RMB150-billion seven-day reverse repos and a RMB50-billion 14-day reverse repos, with flattish bidding rates of 2.2% and 2.35%.
China Foreign Exchange Trade Center announced, on 21 August, the central parities in the interbank forex market of transaction currencies, including the dollar against CNY, are as follows: USD/CNY = 6.9107, up 167 bps from yesterday's central parity and hitting a record high since 23 January.
Some OPEC+ members may have to slash their oil output by an extra 2.31 million barrels per day in August and September to make up for the oversupply in May-July, according to an internal report seen by Reuters. If the extra 2.31 million bpd trim is adopted, the oil group's production cut will be taken to roughly 8.85 million bpd in August-September.
PRE MARKET NEWS
During a campaign event in Pennsylvania, US President Trump said if he is elected, he will slap import tariffs on American companies refusing to move jobs back to the United States from overseas, reported Bloomberg.
The US officials declined to acknowledge a schedule to meet with Chinese negotiators over the Phase 1 trade deal after Chinese Ministry of Commerce had said another negotiation would be held “in the coming days” to review the overall progress, Reuters reported. Instead, the Trump administration stated that a new meeting date remains yet to be pinned down, cited the report.
The U.S. Commerce Department has initiated an anti-dumping investigation into Chinese-built chassis and sub-assemblies for trailers to examine whether Chinese producers are receiving unfair subsidies, reported Reuters.
The Hong Kong Monetary Authority (HKMA) has recently addressed an invitation letter to members of The Hong Kong Association of Banks (HKAB) for a Hong Kong National Security Law briefing held by Hong Kong Police and the HKMA slated for 27 August, local media reported. Each bank may send up to two representatives to the meeting, exclusive to C-suites. The HKMA is bridging the meeting between banks and the police as per request of HKAB, as a HKMA spokesperson replied to the press, in order to acquaint the lenders with the police and keep them abreast of issues related to their operation.
CAR INC (00699.HK). Media reports a consortium led by private equity firm MBK Partners intends to privatize CAR INC (699.HK) and is having talks with BAIC Group, the largest shareholder of CAR INC with a 29% stake, Reuters citing sources. The group plans to offer HK$3.1 per share for the privatization, representing a 19.2% premium to CAR INC's closing price yesterday. The valuation could reach US$850 million.
CAR INC clarified today that it is not in discussion with MBK in relation to any privatization transactions.
Nongfu Spring, the Chinese beverage brand, plans to start HK IPO. from next Monday (24 August) and list on 8 September, pursuing US$1 bn, according to Chinese media. Separately, Hong Kong media reported that various local brokers have reserved margins for the company's IPO: $30 billion by Phillip Securities, $15 billion by Prudential Brokerage, $30 billion by Bright Smart and $20 billion by UOB Kay Hian. Means less margin available for other trading
KINGDEE INT'L (268.HK) plans to place 133 million shares, representing 3.85% of the enlarged share capital of the Company. The net proceeds arising from the placing are estimated to be HK$2.353 billion.
The tender for the third batch of central drug purchases in China worth tens of billions Renminbi initiated in Shanghai, where the bidding results were announced. 125 out of the 189 pharmaceuticals taking part in the procurement were selected with 191 products being picked. The price cut of the shortlisted items averaged 53%, and the sharpest cut reached 95%.
CHINA SCE GROUP (1966.HK) announced that Chairman Wong Chiu Yeung had on 20 August acquired an aggregate of 5 million shares on market via Newup Holdings, involving approximately $20.68 million.