HSI -1350pts (-5.6%) 23,930 HSCEI -423pts (-4.3%) 9,427 T/O HK$180.54bn (+45.3% DoD)
Europe opened lower but working higher, DAX and CAC have made it into the green, FTSE just testing flat
US futures currently indicating a slight +VE. US markets closed on Monday.
US 38 companies reporting today including Alibaba, Regis, JC Penny, Deere, Trip.com and more(for full list https://finance.yahoo.com/calendar/earnings/ )
Investors will be watching for more news on HK over the weekend. Hong Kongers already seem to be expecting protests over the weekend from the chats going around. It will be interesting considering the 8 person group law in force at present. A lot of people had said that the government was deliberately keeping the group rule in force to prevent protests rather than for medical reasons; seems there may have been truth in that. Monday would normally see light volumes with the US markets closed, which could amplify any market moves. Huge shorting today considering HK has an uptick only shorting rule. So watch the market volumes on Monday
Northbound RMB 26,796m Sell 15,044m : 11,752m Buy
Southbound HK$ 17,104m Sell 6,908m : 10,196m Buy
Northbound RMB 36,854m Sell 18,444m : 18,410m Buy
Southbound HK$ 12,101m Sell 5,488m : 6,613m Buy
Short Selling HSI Friday 25.7% vs 20.5% Thursday (very high as uptick only rule)
Top Shorts Hang Seng Bank (11) 63%, Wharf REIC (1997) 52%, CLP (2) 49%, HK & China Gas (3), Hang Lung PPTY (101) 42%, MTRC (66) 42%, NWD (17) 38%, CK Asset (1113) 38%, China Overseas (688) 37%, Country Garden (2007) 35%, BoC HK (2388) 35%, Power Assets (6) 35%, HSBC (5) 34%, Henderson land(12) 34%, ICBC (1398) 32% SHKP (16) 31%, CCB (939) 31%, Hengan (1044) 31%, Sino Land (83) 30%, Techtronic (669) 30%, BoC (3988) 29%, CKI (1038) 27%, AIA (1299) 26%, Link Reit (823) 26%, Swire A (19) 26%, BankComm (3328) 25%, Galaxy Ent (27) 25%
IPO KINTOR PHARMA (9939 HK) debut today, close at HK$ HK$21.3, +6.7% from the IPO price, T/O was $1.484bn
YEAHKA (9923.HK), to be listed on 1 June, recorded over 214 times of over-subscription in the public offering. The TENCENT (0700.HK)-backed Chinese payment-based technology platform recorded over $35.3 billion in margin according to nine local brokers.
CHINA Premier Li Keqiang gave his work report starting at 9am, it went on for nearly two hours. He said there was no specific economic growth target set for this year. That tax trims and charge cuts totaled RMB2.36 trillion last year, beyond the original target at nearly RMB2 trillion. During the year, rural poverty population reduced by 11.09 million, while the poverty rate went down to 0.6%. Also that that FY20 budget deficit is set higher than 3.6%, and the size RMB1 trillion larger than FY19's. RMB1-trillion coronavrirus government bonds will be issued. Employment security and livelihood assurance are put at the top priority this year. Beijing is resolved to get rid of poverty and to construe a prosperous community.FY20 target is set at adding 9 million or more positions in urban areas, keeping urban surveyed and registered jobless rates respectively around 6% and 5.5%, and pushing CPI by around 3.5%. He also said the sturdy monetary policy has to be more flexible this year. China will sharply raise its M2 and pace of aggregate financing to real economy aloft 2019's level through a combination of RRR cut, interest rate cut and re-lending. He mentioned the need to keep RMB exchange rate basically steady at a reasonable and balanced level. China is to facilitate the development of advanced manufacturing and emerging industries. Meanwhile, small and medium-sized banks will be propelled to serve MSMEs better by replenishing capital and bringing perfection to their governance. Li also proposed the ChiNext reform and a pilot registration system. He said governance principles, such as "One Country, Two Systems", "Hong Kong People Ruling Hong Kong", "Macau People Ruling Macau" and high degree of autonomy, have to be implemented precisely. Moreover, solid and sound legal systems and enforcement mechanisms should be established to protect national security in Special Administrative Regions. China opposed any interference from foreign countries in Hong Kong and Macau's affairs. Meanwhile, China should uphold its political stance against "Taiwan Independence”. That China will push forwards the liberalization and convenience in trade and investment, while firmly upholding the multilateral trading system by taking an active role in WTO reform. Equally, China will put its phase one trade deal with the US into practice.China's Secretary-General of the National People's Congress Standing Committee, said seven articles in Hong Kong National Security Law bill laid precaution and punishments on four grounds.
The bill enacted laws to prevent anti-secession behavior and foreign interference activities.HONG KONG Centre for Health Protection said there were 2 new imported COVID-19 cases today.
Japan opened flat, pre market inflation data missed f/casts and market trended lower for most of the day with a small tick up into the close. Special BoJ meeting left the interest rate unchanged. Nikkei Closed -0.8%
S Korea opened flat but trended lower through the day closed Kosdaq -1% and Kospi -1.4%
Taiwan opened lower (having closed at 11k on Thursday) and trended lower to close at the day low -1.8% @ 10,811 After market Taiwan Unemployment hit Apr +4.1% vs +3.76% Mar (F/cast was +3.8%) an all time high.
The banks who had granted loans to Luckin Coffee have started court proceedings at British Virgin Islands against its Chairman Charles Zhengyao Lu to liquidate his private company Haode Investment, Reuters reported. The involving loan banks are Credit Suisse, Goldman Sachs, Morgan Stanley, Barclays, CICC (3908.HK) and HAITONG INT'L (665.HK) in an amount of US$518 million.
POLITICS Carrie Lam said she endorsed the NPC's deliberation of the Decision to establish and improve at the national level the legal system and enforcement mechanisms for the HKSAR to safeguard national security. She said in view of the increasingly serious situation the HKSAR is facing in relation to national security and the difficulty of the executive and legislative authorities of the HKSAR to complete on their own legislation for safeguarding national security in the foreseeable future. She deeply believes that the national law to be enacted by the Standing Committee of the NPC will seek to practically and effectively prevent and curb acts and activities that seriously undermine national security, as well as sanction those who undermine national security by advocating "Hong Kong independence" and resorting to violence. But it will not affect the legitimate rights and freedoms enjoyed by Hong Kong residents under the law, or the independent judicial power, including that of final adjudication, exercised by the Judiciary in Hong Kong.
PROPERTY The tender for the medium-sized residential site, Ap Lei Chau Inland Lot No. 137 at Ap Lei Chau Praya Road is closing today (22 May). 19 tenders have been received for the site, including sole-basis bids from TAI CHEUNG HOLD (88.HK), CHEVALIER INT'L (25.HK), CK ASSET (1113.HK), NEW WORLD DEV (17.HK), GRAND MING (1271.HK) and SINO LAND (83.HK), KAISA GROUP (1638), KWAH (173 HK) and CHINA OVERSEAS (688 HK); and joint-basis bids from LAI SUN DEV (488.HK) and K&K Property.
Apple had in April sold 3.9 million iPhones in China, representing a 1.6-time increase from March, said CINNO Research, and new iPhone SE accounted for 24% of the sales during the month
MTR CORP (66.HK) unveiled the patronage figures for April. The domestic service carried 74.543 million passengers in total, -43.66% YoY and 11.31% MoM.
BRIGHT SMART (1428.HK) that it had disposed of a total of 439,600 BABA-SW (9988.HK) shares on the market in a series of transactions conducted between 13 March 2020 and 21 May 2020 for an aggregate consideration of HK$87.21 million. The company considered the disposal would realize an immediate gain of HK$1.75 million.
US Department of Agriculture and the Trade Representative said China is making progress in regards of the execution of phase one trade deal and some of the US farm products could now be exported to China. Meanwhile, China refreshed the list of facilities that the US could use to export meat and other products.
NPC Press conference mentioned:
The urgency of optimizing the new draft biosecurity law for review and passage within this year.
That national security is a cornerstone of a stable country, as such safeguarding national security is where the fundamental interests lie for people in China, including Hong Kong.
That some members of U.S. Congress had floated negative bills targeting China over the COVID-19 pandemic. These bills were completely unfounded accusations of China, which had breached International Law and underlying norms in international relationships. Beijing voiced its unswerving opposition against the bills.
Trump said the White House will make a very strong reaction upon the passage of the law, despite no details on the Law being available.
COUNTRY GARDEN (2007.HK) suggested to support agriculture-dominant enterprises to vigorously partake in the global agricultural investment development and build overseas crop base. Meanwhile, trial can be carried out for molding unmanned farms orienting enterprises to raise productivity. Shanghai Securities News reported.
Tencent Video Cloud Business, said that the live streaming traffic of e-commerce operators during epidemic shot up by more than 400% period on period. Among which, Mini Programs' live streaming was the top favorite of SMEs. Tencent Video Cloud supported over 3 million times of live streaming.
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