Hong Kong/China Market

Transcription

1 Hong Kong/China Market Technical Strategy X ishares A50 (2823.HK) rose sharply and once breached the upper band of a descending channel on strong turnover. Indices Latest Chg. Pts HSI 25, HSI Future 25, DJIA 17, S&P 500 1, NASDAQ 4, H-share 11, Red-chip 4, Shanghai Comp 2, Shenzhen Comp 1,223-9 But the counter pulled back after pressures from over-buying emerges. The 250-day MA at HKD9.08/share is expected to be a firm support. Hong Kong Market Review Directionless market. The local bourse opened 62 points lower yesterday, tracking the weak finishes of the DJIA, ADR and HSI Futures last Friday. But led by buoyant performance of oil companies and HK landlords, the HSI reversed course in the afternoon session and edged up 54 points to at close on relatively thin turnover of HKD63.4bn. Investment sentiment was low and there was an absence of market-moving catalysts to drive the market. Oil stocks advanced. Sinopec (386.HK) jumped 4.28% to HKD8.04/share as its interim results beat market expectation, thanks to strong growth in its refining business. It also helped push up share prices of other oil shares. CNOOC (883.HK) gained 1.19% to HKD15.3/share and Petrochina (857.HK) 0.92% to HKD10.98/share. Goldwind (2208.HK) soared 28.04% to HKD12.1/share after it turned in a spectacular set of interim results. Local analysts lifted their earnings projections and target prices, anticipating that Goldwind s sales growth would accelerate in 2H14. BYD (1211.HK) reversed course. The counter once dropped over 8% after the company portrayed a not-so-rosy earnings outlook for 3Q14. But it reversed course in the afternoon session and closed the day up 2.24% to HKD50.3/share.

2 Economic News China May Cut Salaries of SOE Executives by 70%, Caijing Says. China may cut salaries of executives at state-owned enterprises and financial institutions by as much as 70 percent, the most drastic proposal yet in a planned overhaul of SOE management, according to Caijing magazine. The upper limit for the annual salary of bosses at central SOEs and banks would be set at Rmb600,000 (USD97,532) under the change, Caijing magazine reports, citing unidentified people with knowledge of a draft plan by the Ministry of Human Resources and Social Security, the Ministry of Finance and other related agencies. The South China Morning Post cited unidentified officials last week as saying SOE executives would face pay cuts of as much as 50 percent under the draft plan. (Bloomberg) China Money Rate Declines Amid Speculation PBOC Will Inject Cash. China s benchmark money-market rate declined for a second day amid speculation the central bank will add cash to the financial system as new share sales boost demand for funds. About Rmb900bn (USD146bn) will be frozen at lenders due to subscriptions for initial public offerings this week, Shanghai Securities News reported 22 Aug14, citing estimates by Shenyin Wanguo Securities Co. The People s Bank of China added a net Rmb25bn in the last two weeks via open-market operations, and there are Rmb65bn of repurchase contracts maturing this week, data compiled by Bloomberg show. (Bloomberg) Macau Casino Workers Protest to Demand for Better Pay. More than 1,000 casino workers in Macau took to the streets yesterday for a seventh time this year to demand better pay and working conditions in the world s largest gambling hub. Members from Macau Gaming Industry Frontline Workers marched through some of the busiest streets in the city and stopped at all of the city s biggest casinos including Sands China Ltd., Galaxy Entertainment Group Ltd. and SJM Holdings Ltd. They waved banners, blew whistles and shouted slogans. (Bloomberg)

3 Company News Golden Meditech (00801.HK) sells CN of China Cord Blood. Golden Meditech Holdings Limited (00801) announces that it has entered into an agreement with Magnum Opus International Holdings Limited and Cordlife Group Limited (collectively, purchasers) to sell 50% of the outstanding principal amount of the 7% senior convertible note due 2017 issued by China Cord Blood Corporation (CCBC), a non-wholly-owned subsidiary of Golden Meditech, at an aggregate purchase price of USD88.09m (HKD m). (Infocast News) Value Partners (00806.HK) sells 2.106m H shares of China Vanke (02202.HK). Value Partners Group Limited (00806) reduced its long position in the H shares of China Vanke Co., Ltd. (02202) from 12.12% to 11.96% on 19 Aug14 by disposing of 2.106m H shares at HKD per share on average on the Stock Exchange, the exchange's Disclosure of Interests information shows. (Infocast News) China LotSyn (01371.HK) unit wins bid to supply terminals. Guangzhou Lottnal Terminal Company Limited, a subsidiary of China LotSynergy Holdings Limited (01371), has won a bid to supply Sports Lottery terminals for the "Anhui Sports Lottery Administration Centre Terminal Procurement Scheme" and signed the relevant supply contract with Anhui Sports Lottery Administration Centre. (Infocast News) SMIC (00981.HK) issues pre-emptive shares, CBs for HKD736m. Semiconductor Manufacturing International Corporation (00981) (SMIC) announced that it has agreed to issue 669m pre-emptive shares to Datang Telecom Technology & Industry Holdings Co., Ltd. at an issue price of HKD0.6 per share for a total consideration of HKD402m. The issue price represents a discount of 17.81% of the stock's closing price of HKD0.73 per share on 22 Aug14. The 669m pre-emptive shares represent 1.89% of the enlarged issued share capital of SMIC. (Infocast News)

4 Result Announcements MTRC (00066.HK) 1H14 recurrent businesses profit up to HKD4.2bn. Excluding investment properties' revaluation, MTR Corporation Limited's (00066) (MTRC) net profit from underlying businesses attributable to equity shareholders for the first six months ended 30 Jun14 increased by 3.2% yoy to HKD4.389bn, of which recurrent businesses profit increased by 10% to HKD4.186bn. (Infocast News) HK & China Gas (00003.HK) 1H14 underlying profit up 13% yoy. Exclusive of its share of a revaluation surplus from the International Finance Centre (IFC) complex and unrealised exchange differences on the Renminbi, The Hong Kong and China Gas Company Limited's (00003) operating profit after taxation for the six months ended 30 Jun14 increased by HKD428m to HKD3.748b, an increase of approximately 13% compared to the same period last year mainly attributable to a rise in profit from the group's local businesses and mainland utility businesses. (Infocast News) Sunac (01918.HK) 1H14 net profit Rmb813m, up 8% yoy. Results of Sunac China Holdings Limited (01918) for the first 6 months ended 30 Jun14: Net profit: Rmb m, up 8% yoy; Basic EPS: Rmb0.244; Interim dividend proposed: nil. (Infocast News) Poly Culture (03636.HK) 1H14 net profit Rmb123m, up 18% yoy. Results of Poly Culture Group Corporation Limited (03636) for the first 6 months ended 30 Jun14: Net profit: Rmb m, up 18.21% yoy; Basic EPS: Rmb0.57; Dividend proposed: nil. (Infocast News) Zhongsheng Hldg (00881.HK) 1H14 net profit Rmb580m, up 19% yoy. Results of Zhongsheng Group Holdings Limited (00881) for the first 6 months ended 30 Jun14: Net profit: Rmb m, up 18.64% yoy; Basic EPS: Rmb0.27; Interim dividend proposed: nil. (Infocast News) K. Wah Int'l (00173.HK) 1H14 net profit HKD214m, down 76% yoy. Results of K. Wah International Holdings Limited (00173) for the first 6 months ended 30 Jun14: Net profit: HKD m, down 75.91% yoy; Basic EPS: HKD7.9 cents; Interim scrip dividend proposed with cash option: HKD5 cents. (Infocast News) GOME (00493.HK) 1H14 net profit Rmb693m, up 115% yoy. Results of GOME Electrical Appliances Holding Limited (00493) for the first 6 months ended 30 Jun14: Net profit: Rmb m, up % yoy; Basic EPS: Rmb0.041; Interim dividend proposed: HKD (Infocast News)

5 Daily Topic China Mobile (941.HK) said that it will further reduce its phone subsidies in 2H14. In order to snatch market share, CM also plans to launch its own-brand 4G handsets at an average price of below Rmb1000. The move may intensify competition in China s smartphone market and therefore squeeze margins of related producers. Coolpad (2369.HK) Has lost the 10-day and 50-day MAs. Trading outlook would deteriorate if it falls below the 250-day MA at HKD1.789/share. TCL Comm (2618.HK) Has pulled back noticeably in recent days and approaches the lower band of the Bollinger channel. Lower band of Bollinger Channel at HKD9.41/share is next support.

6 Lenovo Group (992.HK) Has rocketed to the touch the upper band of the ascending channel. But HKD12/share seems to be a tough resistance. Hang Seng Composite Sectors Sector Index Day (%) Week (%) MTD (%) YTD (%) Hang Seng Index (HSI) 25, Hang Seng Composite 3, HSCI Utilities 7, HSCI Industrial Goods 1, HSCI Materials 5, HSCI Conglomerates 3, HSCI Telecommunication 2, HSCI Property & Construction 3, HSCI Info Technology 5, HSCI Consumer Goods 5, HSCI Financials 3, HSCI Services 4, HSCI Energy 13, HS Mainland 100 7, HS China Enterprises 11, HS China H-Financial 15, HS China Affiliated Corps 4, HS HK 35 2, HS HK Large Cap 2, HS HK MidCap 4, HS HK Small Cap 2, Source: Bloomberg

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