20150923-新鸿基金融集团-INVESTMENT_DAILY_NOTE_13页_2mb

Summary of Market Analysis

Core Content

This document provides an overview of the current state and trends of the Hong Kong and Chinese equities markets, along with key financial indicators, stock performance, and sector analysis. It includes insights on major indices, individual stocks, and market data such as interest rates, exchange rates, and commodities.

Main Points

Market Trends

• The Hang Seng Index (HSI) and Hang Seng China Enterprises Index (HSCEI) failed to break through short-term resistance levels and are in a consolidation phase.
• The Chinese economy is expected to see a slowdown in electricity consumption growth to 2% in 2015, the lowest since 1998, which is likely to dampen equity market sentiment.
• The U.S. equities markets saw a slump, with the Dow Jones Industrial Average (DJIA), S&P 500, and Nasdaq Composite all declining. ADRs also dropped, impacting the HSI.

Sector Performance

• The top-performing sectors on the previous day include Chinese Telecoms, Sports Accessories, HK Telecoms, and Airline, with gains ranging from 0.5% to 2.3%.
• The Chinese Property and Toll Road sectors showed positive performance, indicating potential growth opportunities.
• Some sectors, such as Consumer Staples and Oil-related, experienced declines, suggesting caution in these areas.

Key Stocks

• Fosun International (656.HK): Trading at a low forward P/E ratio of 9.9x, which is below its five-year average of 10.5x. The stock is recommended for purchase at HK$13.20 or below, with a target of HK$16.00 and a stop-loss at HK$11.30. It is showing strong growth in its insurance and health sectors.
• GCL-Poly Energy (3800.HK): Expected to see a price increase, with a purchase price at current level, target price of HK$1.72, and stop-loss at HK$1.50. The stock is noted for its attractive valuation and potential for a turnover surge.
• Pak Wing GP (8316.HK): Strong performance due to a recent quarter turnaround, with a target price of HK$5.00 and a stop-loss at HK$4.50. Aggressive investors are advised to consider a small bet on this stock.

Market Data

• Indices: The HSI closed at 21,797 with a daily change of +0.2% and a year-to-date change of -7.7%. The HSCEI closed at 9,835 with a daily change of -0.6% and a year-to-date change of -17.9%. The Shanghai Composite and Shenzhen Composite showed mixed performance.
• Interest Rates: U.S. interest rates have seen a decline, while Hong Kong interest rates remained relatively stable. The Shanghai interest rates were significantly higher than Hong Kong.
• Exchange Rates: The USD/HKD exchange rate remained stable, but other currencies like EUR/USD and USD/JPY showed declines.
• Commodities and Precious Metals: Prices for crude oil, gold, and other commodities declined, indicating a potential slowdown in global demand.

A-share Premium to H-share

• The A-share premium to H-share varies significantly among companies, with some showing a premium of over 300% and others showing a negative premium, indicating a potential undervaluation in the H-share market.

Key Information

• The Chinese central bank is set to launch the CIPS system in early October, which is expected to enhance the internationalization of the renminbi.
• The document highlights stocks that are showing potential for growth based on technical analysis and recent corporate developments.
• The A-share premium to H-share data is crucial for investors looking to compare valuation levels between the two markets.
• Market sentiment is influenced by economic data and global conditions, with a focus on slowing economic growth and its impact on equities.

Summary Table

• The A-share premium to H-share for several major companies is significantly high, suggesting potential for value appreciation in the H-share market.
• The most traded ETFs in Hong Kong include the iShares FTSE A50, CSOP FTSE CH-HKD, and others, indicating market interest in diversified investment options.

Conclusion

The document emphasizes the importance of tracking market trends, sector performance, and individual stock movements. It suggests that investors should consider stocks with strong fundamentals and potential for growth, while also monitoring valuations and economic indicators to make informed decisions.