20171121-凯基证券亚洲-Investment_Daily_5页_257kb

Market Summary

Core Market Indicators

Hang Seng Index (HSI)

• 20 Nov Closing Price: 29,260 points (+61)
• 17 Nov Closing Price: 29,199 points (+180)
• 16 Nov Closing Price: 29,018 points (+167)
• Total Turnover (mn): 108,200
• Technical Indicators:
  • 10-days MA: 29,082
  • 50-days MA: 28,361
  • 250-days MA: 25,413
  • 14-days RSI: 63.9
  • Primary Resistance: 29,500
  • Primary Support: 29,000
• HSI Futures:
  • Nov Contract: 29,198 (Volume: 97,511; Open Interests: 143,863)
  • Dec Contract: 29,216 (Volume: 2,176; Open Interests: 27,702)

Hang Seng China Enterprises Index (HSCEI)

• 20 Nov Closing Price: 11,538 points (-70)
• 17 Nov Closing Price: 11,609 points (+75)
• 16 Nov Closing Price: 11,533 points (+121)
• Total Turnover (mn): 11,521
• Technical Indicators:
  • 10-days MA: 11,609
  • 50-days MA: 11,392
  • 250-days MA: 10,496
  • 14-days RSI: 50.5
  • Primary Resistance: 11,818
  • Primary Support: 11,392
• HSCEI Futures:
  • Nov Contract: 11,521 (Volume: 68,357; Open Interests: 218,175)
  • Dec Contract: 11,526 (Volume: 1,581; Open Interests: 73,310)

Market Outlook

• The HSI is expected to trade between 29,100 and 29,500 today.
• The index reversed its decline in the afternoon, closing at 29,260 points.
• Southbound funds continue to flow into the Hong Kong market, providing support.
• Local blue chips, especially Tencent (700), performed well in the US ADR market, suggesting potential for a higher open today.
• The HSI technical indicators remain positive, with the index maintaining above the 10-day moving average and the MACD bullish gap stabilizing.

Sector Performance

• Macau gaming stocks surged, with some rising over 4%.
• Internet stocks, including Razer (1337), declined, with Razer falling 4%.
• Infrastructure stocks remained subdued, with some stocks falling below 52-week lows.

Regulatory Developments

• The PBOC issued new regulations on asset management products, which will:
  • Prohibit principal-guaranteed and revenue-guaranteed products.
  • Require 10% provisions from product management fees.
  • Apply to wealth management products, capital trust plans, and other financial instruments.
• The regulations aim to prevent financial risks and unify regulatory standards.
• National banks are expected to outperform joint-stock banks in the remainder of 2017 due to better fundamental performance, including lower non-performing loan ratios and higher net interest income growth.

Stock Connect Statistics

• SH Connect Balance: 14.50 RMB bn

• SZ Connect Balance: 12.23 RMB bn

• Combined Southbound Balance: 16.62 RMB bn

• Top 10 Most Actively Traded Stocks (SH-HK Connect Southbound):

  • TENCENT (700): Buy 894,166,960 RMB, Sell 369,702,360 RMB, Turnover 1,263,869,320 RMB
  • PING AN (2318): Buy 958,291,250 RMB, Sell 84,667,600 RMB, Turnover 1,042,958,850 RMB
  • ICBC (1398): Buy 428,123,670 RMB, Sell 218,779,863 RMB, Turnover 646,903,533 RMB
  • SMIC (981): Buy 283,964,160 RMB, Sell 144,714,662 RMB, Turnover 428,678,822 RMB
  • CPIC (2601): Buy 261,319,990 RMB, Sell 93,817,010 RMB, Turnover 355,137,000 RMB
  • ABC (1288): Buy 279,965,760 RMB, Sell 41,264,300 RMB, Turnover 321,230,060 RMB
  • GAC GROUP (2238): Buy 131,241,520 RMB, Sell 187,293,420 RMB, Turnover 318,534,940 RMB
  • NCI (1336): Buy 193,947,595 RMB, Sell 113,913,860 RMB, Turnover 307,861,455 RMB
  • CHINA TAIPING (966): Buy 166,904,850 RMB, Sell 105,532,680 RMB, Turnover 272,437,530 RMB
  • CCB (939): Buy 107,145,420 RMB, Sell 74,829,980 RMB, Turnover 181,975,400 RMB

• Top 10 Most Actively Traded Stocks (SZ-HK Connect Southbound):

  • TENCENT (700): Buy 343,681,540 RMB, Sell 194,968,900 RMB, Turnover 538,650,440 RMB
  • ZTE (763): Buy 200,103,920 RMB, Sell 69,150,540 RMB, Turnover 269,254,460 RMB
  • PING AN (2318): Buy 134,597,125 RMB, Sell 10,259,175 RMB, Turnover 144,856,300 RMB
  • SMIC (981): Buy 77,992,210 RMB, Sell 64,812,860 RMB, Turnover 142,805,070 RMB
  • SUNAC (1918): Buy 86,118,600 RMB, Sell 20,841,150 RMB, Turnover 106,959,750 RMB
  • CPIC (2601): Buy 82,120,850 RMB, Sell 19,312,940 RMB, Turnover 101,433,790 RMB
  • ICBC (1398): Buy 85,098,380 RMB, Sell 1,325,110 RMB, Turnover 86,423,490 RMB
  • CHINA VANKE (2202): Buy 61,379,835 RMB, Sell 21,317,605 RMB, Turnover 82,697,440 RMB
  • BYD COMPANY (1211): Buy 47,914,500 RMB, Sell 33,148,725 RMB, Turnover 81,063,225 RMB
  • GAC GROUP (2238): Buy 32,413,580 RMB, Sell 35,823,340 RMB, Turnover 68,236,920 RMB

Key Stock Analysis

Giordano (709)

• Closed Price: 4.14 HKD
• Expected P/E: 13.1x
• 52-week high: 4.85 HKD
• 52-week low: 3.70 HKD
• 14-days RSI: 25.4
• Performance:
  • QoQ sales growth slowed to 2.3% (vs. 3.6% in H1 2017)
  • QoQ gross margin fell by 0.3 percentage point
  • Full year net profit growth is expected to be below H1 level but still 14%
• Valuation: Reasonable, with a strong net cash position and a dividend yield over 7%
• Recommendation: Accumulate when the price corrects, with a target price of 4.6 HKD

China Gas (384)

• Closed Price: 22.6 HKD
• Expected P/E (FY18): 17.0x
• Dividend Yield: 1.6%
• 52-week high: 25.00 HKD
• 52-week low: 9.66 HKD
• 14-days RSI: 42.0
• Performance:
  • Positive profit alert for the six months ended 30 September 2017
  • Consolidated net profit increased by >90% compared to the same period in 2016
  • Benefited from "coal-to-gas" policies and value-added business
• Valuation: Fair
• Recommendation: Accumulate when the share price corrects

Economic Calendar Highlights

• Mon: Want Want (0151) releases 3Q17 earnings
• Tue: Chow Tai Fook releases 2Q17 earnings
• Wed:
  • US: Oct. Durable Goods Orders (0.3% vs. 2.0% prior)
  • US: Initial Jobless Claims (Nov. 18) at 249K
  • US: Continuing Claims (Nov. 11) at 1,860K
• Thu:
  • US, Japan: Market closed
  • Eurozone: Nov. Markit Manufacturing PMI (58.2 vs. 58.5 prior)
  • UK: 3Q GDP (YoY Finalized) at 1.5%
• Fri: US: Nov. Markit Manufacturing PMI (55.0 vs. 54.6 prior)

Disclaimer

• The information and opinions in this report are the views of KGI Asia Ltd. internal research activity.
• No warranty or guarantee is given regarding the accuracy, completeness, or fairness of the information.
• The report is for informational purposes only and may not be reproduced or published without prior written consent from KGI Asia Ltd.