Hong Kong/China Market

Transcription

1 Hong Kong/China Market Technical Strategy The NASDAQ has reached an all-time high Indices Latest Chg. Pts HSI 28, HSI Future 28, DJIA 26, S&P 500 2, NASDAQ 8, H-share 11, Red-chip 4, Shanghai Comp 2, Shenzhen Comp 1, While trading outlook remains buoyant, the index is set to challenge the 8000 points resistance soon. Hong Kong Market Review Stimulated by the central bank policies. The Fed Chair Jerome Powell has conveyed a more dovish tone that the Fed will continue raising rates gradually and cautiously based on ongoing US economic data. On the other hand, PBOC vowed to adjust CNY fix factors to keep market stable. Both news have allayed some investor worries on the capital flight of the emerging markets. The HSI opened 344 points higher and soon gained momentum. The index closed near day highs by climbing 599 points to Turnover expanded again to HKD96bn. ZTE (0763.HK) rallies after US picked former prosecutor as the new compliance coordinator. Investors are excited that the recovery of business operation of ZTE is having progress and its shares popped 7.08% to HKD14.82/share. 5G-concept shares were also spurred with Mobi Development (0947.HK) bouncing back 5% to HKD0.84/share. YOFC (6869.HK) also soared 8.09% to HKD29.4/share after reporting decent 1H18 results and honoring its guidance for resuming the dividend payout aborted by the A-share listing before.

2 Economic News U.S. says China's steel wheels subsidized, will impose duties on imports. The U.S. Commerce Department said on Monday it had made a preliminary determination that imports of certain steel wheels from China were subsidized at rates ranging from percent to percent, and it would impose duties on the product. As a result of today s decision, Commerce will instruct U.S. Customs and Border Protection to collect cash deposits from importers of certain steel wheels from China based on these preliminary rates, the department said in a statement. (Reuters) Mexican official says agreed with U.S. to include Canada in NAFTA. The United States and Mexico have agreed to include Canada in ongoing talks to update the North American Free Trade Agreement (NAFTA), Jesus Seade, the designated top trade negotiator for Mexico s incoming government, said on Monday. It is completely our aspiration and preference that this be (a) trilateral (deal). That is what is agreed with the United States, Seade told reporters in Washington. (Reuters) Markets may be signaling rising recession risk: Fed study. A narrowing gap between short-term and long-term borrowing costs could be signaling heightened risk of a U.S. recession, researchers at the San Francisco Federal Reserve Bank said in a study published on Monday. The research relies on an in-depth analysis of the gap between the yield on three-month and 10-year U.S. Treasury securities, a gap that like other measures of short-to-long-term rates has narrowed in recent months. Several Fed officials have cited this flattening yield curve as a reason to stop raising interest rates, since historically each time it inverts, with short-term rates rising above long-term rates, a recession follows. (Reuters) Turkey says U.S. trade sanctions could destabilise region, lira slide continues. Turkey warned on Monday that U.S. trade sanctions against it could destabilise the Middle East and ultimately bolster terrorism and the refugee crisis, underscoring the regional impact of Ankara s deepening rift with Washington. Turkish Finance Minister Berat Albayrak, who is President Tayyip Erdogan s son-in-law, used a visit to Paris to both take aim at the United States and highlight Ankara s push for better ties with Europe, given the stand-off with Washington. (Reuters)

3 Market News Asian shares gain on U.S.-Mexico trade optimism. Asian shares advanced again on Tuesday while major currencies held on to gains amid hopes global tariff tensions were abating as the United States and Mexico made a deal to overhaul the North American Free Trade Agreement. Investors expect Canada too would agree to the new terms to preserve a three-nation pact, ultimately dispelling the economic uncertainty caused by U.S. President Donald Trump s repeated threats to ditch the 1994 NAFTA accord. MSCI s broadest index of Asia-Pacific shares outside Japan climbed 0.3 percent for a second straight day of gains. Australian shares added 0.5 percent while Japan s Nikkei jumped 0.8 percent. (Reuters) S&P 500, Nasdaq hit new highs on U.S.-Mexico trade deal. A broad-based rally pushed the S&P 500 and the Nasdaq to record-high closes for the second straight session on Monday as a trade agreement reached between the United States and Mexico buoyed investor sentiment. Technology stocks led the Nasdaq above the 8,000 mark for the first time and the sector provided the biggest boost to the S&P 500. A senior U.S. trade official announced a deal with Mexico to replace the North American Trade Agreement and said talks with Canada were expected to begin immediately. (Reuters) Oil rises on expectations of tightening market. Oil prices rose on Tuesday as risks of supply disruptions from places such as Venezuela, Africa and Iran triggered expectations of a tightening market. International Brent crude oil futures LCOc1 were at $76.51 per barrel at 0037 GMT, up 30 cents, or 0.4 percent, from their last close. U.S. West Texas Intermediate (WTI) crude futures CLc1 were up 24 cents, or 0.4 percent, at $69.11 a barrel. SPONSORED Despite some concerns about an economic slowdown because of trade conflict between the United States and China, crude supplies are relatively tight due to disruptions as well as voluntary restraints on output by the Organization of the Petroleum Exporting Countries (OPEC). (Reuters) Gold prices steady as dollar sags on U.S-Mexico trade deal. Gold prices held steady on Tuesday after hitting a two-week high in the previous session, with the dollar under pressure in the wake of a trade deal between the United States and Mexico. Spot gold was steady at $1, an ounce at 0047 GMT. Prices hit their highest since Aug. 13 at $1, on Monday, while the metal rose about 1.7 percent on Friday in its biggest one-day percentage gain since May 17, (Reuters)

4 Company Announcements Tian Lun Gas (01600) 1H profit RMB215M; div RMB Net profit: RMB M, up 15.25% YoYBasic EPS: RMB0.22Dividend per share proposed: an interim dividend of RMB per share. (Infocast News) Chow Sang Sang (00116) 1H profit soars 54%; div $0.15. Net profit: HK$ M, up 54.44% YoYBasic EPS: HK$0.894Dividend per share proposed: HK$ (Infocast News) Shui On Land (00272) 1H profit rises 36%; div $ Net profit: RMB1.225B, up 36.41% YoYBasic EPS: RMB0.152Dividend per share proposed: HK$ (RMB0.0314). (Infocast News) Tingyi (00322) 1H profit soars 87% to RMB1.306B. Net profit: RMB1.306B, up 86.59% YoYBasic EPS: RMB0.2326Dividend per share proposed: (Nil). (Infocast News)

5 Today s Sector Focus CNOOC (0883.HK) and Sinopec (0386.HK) have both announced their 1H18 results. Both companies beat market expectations in bottom lines while management is positive that the oil prices could be kept around the USD70-80/barrel for the rest of the year. Related shares outperformed in recent sessions. Sinopec (0386.HK) Gapping above the 50-day MA is a bullish sign. Large white candle represents strong momentum. PetroChina (0857.HK) Retaking all major MAs improves its trading outlook. Set to challenge the HKD6.09/share resistance soon.

6 CNOOC (0883.HK) Quickly retaking all major MAs in recent sessions improves its trading outlook. HKD14/share is the next resistance. Hang Seng Composite Sectors Sector Index Day (%) Week (%) MTD (%) YTD (%) Hang Seng Index (HSI) 28, Hang Seng Composite 3, HSCI Utilities 7, HSCI Industrial Goods 1, HSCI Materials 5, HSCI Conglomerates 2, HSCI Telecommunication 1, HSCI Property & Construction 4, HSCI Info Technology 12, HSCI Consumer Goods 5, HSCI Financials 3, HSCI Services 3, HSCI Energy 10, HS Mainland 100 8, HS China Enterprises 11, HS China H-Financial 16, HS China Affiliated Corps 4, HS HK 35 3, HS HK Large Cap 2, HS HK MidCap 4, HS HK Small Cap 2, Source: Bloomberg

7 - Analyst Certification Each research analyst primarily responsible for the content of this research report, in whole or in part, certifies that with respect to each security or issuer that the analyst covered in this report: (1) all of the views expressed accurately reflect his or her personal views about those securities or issuers; and (2) no part of his or her compensation was, is, or will be, directly or indirectly, related to the specific recommendations or views expressed by that research analyst in the research report. Disclaimer This document is prepared by VC Brokerage Limited ( VC ) to provide information about the securities mentioned herein. It is for distribution only under such circumstances as may be permitted by applicable law. It has no regard to the specific investment objectives, financial situation or particular needs of any specific recipient. It is published for informational purposes and is not to be construed as a solicitation or an offer to buy or sell any securities or related financial instruments. No representation or warranty, either expressed or implied, is provided in relation to the accuracy, completeness or reliability of the information contained herein, nor is it intended to be a complete statement or summary of the securities, markets or developments referred to in this document. It should not be regarded by the recipients as a substitute for the exercise of their own judgment. Any prices or levels contained in these pages are indicative and may vary in accordance with changes in market conditions. Investors are warned that the price of any securities may fall in value as rapidly as it may rise and holders may sustain a total loss of their investment. No liability is accepted whatsoever for any direct, indirect or consequential loss arising from the use of this document, and no claims, actions or legal proceedings may be brought against VC in connection with this document in any manner whatsoever by any person dealing with the securities and/or the related financial instruments mentioned herein. Any opinions expressed in this document are subject to change without notice. VC is under no obligation to update or keep current the information contained herein. VC and its affiliates, their directors, officers and employees or clients may have or have had interests or long or short positions in the securities or other financial instruments referred to herein, and may at any time make purchases and/or sales in them as principal or agent. VC and its affiliates may have or have had a relationship with or may provide or has provided investment banking, capital markets and/or other financial services to the relevant companies. Employees of VC and its affiliates may serve or have served as officers or directors of the relevant companies. report are based upon sources believed to be accurate, but no responsibility is accepted for any loss occasioned by reliance placed upon the contents herein. Further information on the companies mentioned in this report is available