20151123-新鸿基金融集团-INVESTMENT_DAILY_NOTE_13页_2mb

Investment Daily Note Summary

Core Content

• Market Highlights: Mario Draghi, ECB President, indicated that the Eurozone's economic growth is weak and inflation is below target. If current monetary policy fails, the ECB may take further actions to boost inflation, including asset purchases or deposit rate changes. This has increased market expectations for quantitative easing, which could benefit global equities. In China, the re-launch of IPOs has led to capital inflows, potentially causing a short-term correction in secondary markets.

• Equity Indices:

  • Hang Seng Index (HSI): Closed at 22,755, up 1.1% with a YTD decline of 3.6%.
  • HSCEI: Closed at 10,302, up 1.1% with a YTD decline of 14.0%.
  • Shanghai Composite: Closed at 3,631, up 0.4% with a YTD increase of 12.2%.
  • Shenzhen Composite: Closed at 2,286, up 1.3% with a YTD increase of 61.5%.

• Hong Kong Market Turnover:

  • HSI: Turnover of HK$17.5bn, down 8.08%.
  • HSCCI: Turnover of HK$4.2bn, down 11.74%.
  • HSCEI: Turnover of HK$10.0bn, down 11.95%.
  • Main Board: Turnover of HK$64.4bn, down 3.59%.

Main Points

• Market Sentiment: The Hong Kong stock market showed a sluggish start but rallied in the afternoon, with HSI rising nearly 300 points and HSCEI gaining 108 points. Property stocks rebounded by over 2% in general, with some hitting a five-day high.

• IPO Impact: The re-launch of IPOs with ten companies submitting proceeds has led to capital inflows, potentially causing a short-term correction in secondary markets.

• CITIC SEC-H (6030.HK):

  • Last Close: HK$19.20
  • Entry: HK$19.00
  • Target: HK$24.50
  • Stop-loss: HK$17.00
  • YTD/1M/3M/12M % Change: -34.2%/14.1%/1.9%/-4.7%
  • Market Cap: HK$288.91bn
  • 3M Average Daily Volume: 24.49mn shares
  • FY1 Forward P/E: 10.3x
  • The stock is seen as a good buy due to its attractive valuation and expected growth in investment banking due to IPO re-launch.

• Today's Top Picks:

  • Digital China (861.HK): Expected to rise with a strategic cooperation agreement with the Henan government. Target Price: HK$10.90, Stop-loss Price: HK$7.64.
  • Wisdom Sports (1661.HK): Share price rose with increasing volume. Target Price: HK$5.80, Stop-loss Price: HK$4.40.

Sector Performance

• Top Performing Sectors (1D % Change):

  • Technology: 3.4%
  • Durable Consumables: 3.1%
  • Other Metals: 3.0%
  • Telecoms Equipment: 2.2%
  • Steel: 2.1%
  • Sports Accessories: 1.8%
  • Brokerages: 1.5%
  • Other sectors also showed positive performance.

• Major Stocks in Top Performing Sectors:

  • Technology: Kingdee (268), Chinasoft (354), Tencent (700), NetDragon (777), Kingsoft (3888)
  • Durable Consumables: Welling Hldg. (382), Skyworth Digital (751), Hisense Kelon Elec (921), TCL Multimedia (1070)
  • Other Metals: Jiangxi Copper (358), CMOC (3993), Zhaojin Mining (1818), Zijin Mining (2899)
  • Telecoms Equipment: China Com Service (552), ZTE (763), Trigiant (1300), Comba (2342)
  • Steel: Angang Steel (347), Maanshan Iron (323), Shougang Res (639)
  • Aluminum: Chalco (2600), China Hongqiao (1378), China Zhongwang (1333), RUSAL (486)
  • Sports Accessories: 361 Degrees (1361), Xstep Int'l (1368), Peak Sport (1968), Anta Sports (2020), Li Ning (2331)
  • Chinese Telecoms: China Telecom (728), China Unicom (762), China Mobile (941)
  • Local Property: CK Hutchison (1), Henderson Land (12), SHK Prop (16), New World Dev (17), Sino Land (83)
  • Brokerages: First Shanghai (227), Central China Sec. (1375), CITIC Sec. (6030), Haitong Sec. (6837), China Gala Sec. (6881)
  • Airline: Cathay Pacific (293), China East Air (670), Air China (753), China South Air (1055)
  • Infrastructure: China Railway (390), China Railway Cons. (1186), CSR Corp. (1766), China Comm. Cons. (1800), China Machinery Eng. (1829)
  • Chinese Property: COLI (688), China Res Land (1109), Sunac (1918), Country Garden (2007), Evergrande (3333)
  • Coal: China Shenhua (1088), Yanzhou Coal (1171), China Coal (1898)
  • Chinese Insurers: China Taiping Ins. (966), NCI (1336), CPIC (2601), Ping An (2318), China Life (2628)

Valuations and Earnings Growth

• Forward P/E and Valuations:
  • Hang Seng Index: FY15E P/E 11.5, Long-term avg. fwd. P/E 11.3, Deviation from avg. 1.7%, FY1 EPS growth -12.6%, FY2 EPS growth 5.3%.
  • HSCEI: FY15E P/E 7.7, Long-term avg. fwd. P/E 8.5, Deviation from avg. -9.1%, FY1 EPS growth -1.9%, FY2 EPS growth 4.2%.
  • Shanghai Composite: FY15E P/E 15.5, Long-term avg. fwd. P/E 11.0, Deviation from avg. 40.6%, FY1 EPS growth 22.6%, FY2 EPS growth 10.9%.
  • S&P 500: FY15E P/E 17.7, Long-term avg. fwd. P/E 14.7, Deviation from avg. 19.9%, FY1 EPS growth 5.7%, FY2 EPS growth 9.0%.

Market Data

• Best and Worst Performers:

  • Best: WUZHOU INTERNATI (1369.HK), CHINA OVERSEAS G (81.HK), DIGITAL CHINA (861.HK), CMOC-H (3993.HK), TCL MULTIMEDIA T (1070.HK).
  • Worst: ZALL DEVELOPMENT (2098.HK), CRTG (269.HK), CHINA RES GAS (1193.HK), ENN ENERGY (2688.HK), CHINA GAS HOLDIN (384.HK).

• HSCI Volume Filter:

  • MINGFA GROUP INT (846.HK), WUZHOU INTERNATI (1369.HK), BOYAA INTERACTIV (434.HK), CHINA OVERSEAS G (81.HK), XINCHEN CHINA PO (1148.HK), etc., showed increased trading volumes.

• Most Short Sold Stocks:

  • BANK EAST ASIA (23.HK), HAIER ELECTRONIC (1169.HK), SUN ART RETAIL (6808.HK), WANT WANT CHINA (151.HK), JINGWEI TEXTIL-H (350.HK), etc., were among the most short sold.

External Market Conditions

• Interest Rates:

  • U.S. 2-year Treasury yield: 0.9172%, up 8.25 bps in 5D.
  • U.S. 10-year Treasury yield: 2.2623%, down 0.35 bps in 5D.
  • U.S. 30-year Treasury yield: 3.0199%, down 3.20 bps in 5D.
  • HK 1-month HIBOR: 0.1901%, down 0.65 bps in 5D.
  • HK 3-month HIBOR: 0.3723%, down 0.30 bps in 5D.
  • SH 1-month HIBOR: 2.7000%, up 0.30 bps in 5D.
  • SH 3-month HIBOR: 3.0440%, up 1.00 bps in 5D.

• Exchange Rates:

  • USD Dollar Index: 99.7160, up 0.3% in 5D.
  • USD/HKD: 7.7502, no change in 5D.
  • EUR/USD: 1.0635, down 0.5% in 5D.
  • USD/JPY: 122.97, up 0.2% in 5D.
  • GBP/USD: 1.5182, down 0.1% in 5D.
  • USD/CHF: 1.0197, down 0.9% in 5D.
  • AUD/USD: 0.7218, up 1.7% in 5D.
  • NZD/USD: 0.6533, up 0.6% in 5D.
  • USD/CAD: 1.3358, down 0.2% in 5D.
  • USD/CNY: 6.3850, down 0.2% in 5D.
  • USD/CNH: 6.4179, down 0.2% in 5D.

• Precious Metals and Commodities:

  • CRB Index: 183.7, down 0.6% in 5D.
  • Comex Gold: 1,074.5, down 0.8% in 5D.
  • Comex Silver: 14.095, down 0.9% in 5D.
  • Nymex WTI Crude: 41.6, down 0.3% in 5D.
  • ICE Brent Crude: 44.58, no change in 5D.
  • LME Copper: 4,580.00, down 5.1% in 5D.
  • LME Aluminum: 1,447.00, down 3.0% in 5D.
  • CBT Wheat: 488.50, down 1.5% in 5D.
  • CBT Corn: 363.25, up 1.4% in 5D.
  • CBT Soybean: 857.50, up 0.3% in 5D.

A-share Premium to H-share

• Selected Companies:
  • LUOYANG GLASS-H (1108.HK): A-share premium to H-share 187.0%.
  • SINOPEC OILFIE-H (1033.HK): A-share premium to H-share 224.0%.
  • ZHEJIANG SHIBA-H (1057.HK): A-share premium to H-share 223.8%.
  • CHINA COSCO HO-H (1919.HK): A-share premium to H-share 185.8%.
  • SHANGHAI ELECT-H (2727.HK): A-share premium to H-share 183.4%.
  • ZOOMLION HEAVY-H (1157.HK): A-share premium to H-share 111.7%.
  • PETROCHINA-H (857.HK): A-share premium to H-share 93.8%.
  • JIANGXI COPPER-H (358.HK): A-share premium to H-share 91.7%.
  • CITIC SEC-H (6030.HK): A-share premium to H-share 29.8%.

Top 20 Most Traded ETFs

• The list of top 20 most traded ETFs is not fully provided, but the section indicates that it is available for reference.