Investment Daily Note Summary - 11 September 2013
Core Content Overview
This investment note provides an overview of the stock market performance on 11 September 2013, including key stock recommendations, market indices, trading volumes, and economic data. It also highlights upcoming company results, green policies, and exchange rates, offering insights into the market dynamics and investment opportunities.
Main Market Trends
- U.S. Stocks: Gained due to eased Syrian tension, with the Dow closing at 15,191, up 127 points.
- Crude Oil and Gold: Both fell in value, with crude oil futures dropping to $107.39/bbl and gold futures to $1,364/oz.
- Hong Kong Market: The Hang Seng Index (HSI) edged near 23,000, closing at 22,976, up 226 points. Market turnover reached HK$78.24bn.
- Shanghai Composite: Rose by 1.2% to 2,237, while the Shenzhen Composite increased by 1.6%.
- ETF Performance: Several Chinese and Japanese ETFs showed positive performance, with the Shanghai Composite ETF (3118.HK) rising by 1.1% and the ChinaAMC CSI 300 (3188.HK) up by 1.6%.
Key Stock Analysis
- Price: HK$1.46
- Target: HK$1.70
- Stop Loss: HK$1.30
- Positive Factors: Huge growth potential in same-store sales, attractive valuation
- Performance: Interim profit fell 15% yoy to RMB398mn, but net profit (excluding non-operating items) rose 9% to RMB338mn.
- Company Overview: Operates 39 department stores in 19 Chinese cities, with 66% of stores operating for 2-5 years, indicating strong growth potential.
- Recommendation: Buy, with a technical uptrend.
Tianjin Capital (1065.HK)
- Price: HK$2.94
- Target: HK$3.30
- Stop Loss: HK$2.70
- Positive Factors: New green policies, potential for new projects, and reclaimed-water tariff hike.
- Performance: Signed a new service agreement, leading to a 7% revenue increase in the waste water treatment and construction business, and 92% growth in reclaimed water business.
- Recommendation: Buy, with a technical breakout from a short-term downtrend.
Upcoming Interim Results
| Company |
Stock Code |
Consensus Estimate |
| Smartone |
315.HK |
— |
| SHK Properties |
16.HK |
— |
| Prada |
1913.HK |
Net profit up 13% to EUR$325 mn |
| BOSSINI |
592.HK |
— |
Economic Data and Events
| Date |
Country/Region |
Event |
Period |
Survey |
Prior |
| Wed 11 Sep |
US |
MBA Mortgage Applications |
Sep 6 |
- |
1.3% |
| Wed 11 Sep |
US |
Wholesale Inventories MoM |
Jul |
0.3% |
-0.2% |
| Wed 11 Sep |
UK |
Jobless Claims Change |
Aug |
-21.0K |
-29.2K |
| Thu 12 Sep |
New Zealand |
RBNZ Official Cash Rate |
- |
2.50% |
2.50% |
| Thu 12 Sep |
South Korea |
BoK 7-Day Repo Rate |
- |
2.50% |
2.50% |
| Thu 12 Sep |
Indonesia |
Bank Indonesia Reference Rate |
- |
7.00% |
7.00% |
| Wed 11 Sep |
US |
Initial Jobless Claims |
Sep 6 |
330K |
323K |
| Wed 11 Sep |
US |
Continuing Claims |
Aug 30 |
2968K |
2951K |
| Wed 11 Sep |
US |
Import Price Index MoM |
Aug |
0.5% |
0.2% |
| Fri 13 Sep |
US |
Monthly Budget Statement |
Aug |
-$151.1B |
-$190.5B |
| Fri 13 Sep |
US |
PPI MoM |
Aug |
0.2% |
0.0% |
| Fri 13 Sep |
US |
PPI YoY |
Aug |
1.3% |
2.1% |
| Thu 12 Sep |
Japan |
Machine Orders MoM |
Jul |
2.4% |
-2.7% |
| Mon 16 Sep |
US |
Industrial Production MoM |
Aug |
0.3% |
0.0% |
| Mon 16 Sep |
US |
Capacity Utilization |
Aug |
77.8% |
77.6% |
| Mon 16 Sep |
Euro Zone |
CPI YoY (Final) |
Aug |
- |
1.6% |
| Mon 16 Sep |
Euro Zone |
CPI MoM (Final) |
Aug |
- |
-0.5% |
| Mon 16 Sep |
Japan |
Industrial Production YoY (Final) |
Jul |
- |
1.6% |
Market Data Highlights
Best Performers
| Company |
Stock Code |
Price (HK$) |
1D Chg (%) |
1W Chg (%) |
1M Chg (%) |
Ytd Chg (%) |
Turnover (HK$m) |
FY1 P/E |
FY2 P/E |
| Yanzhou Coal |
1171.HK |
8.000 |
10.0 |
11.3 |
34.2 |
(37.6) |
652.8 |
54.4 |
17.1 |
| China Coal |
1898.HK |
5.230 |
7.0 |
7.0 |
13.4 |
(37.9) |
547.0 |
9.4 |
9.3 |
| Air China |
753.HK |
5.630 |
6.4 |
11.0 |
10.4 |
(14.0) |
212.9 |
12.7 |
10.7 |
| Sinofert |
297.HK |
1.380 |
6.2 |
9.5 |
13.1 |
(26.6) |
46.1 |
10.2 |
8.9 |
| CITIC Pacific |
267.HK |
9.920 |
4.9 |
6.9 |
14.0 |
(14.2) |
210.4 |
9.3 |
9.8 |
Worst Performers
| Company |
Stock Code |
Price (HK$) |
1D Chg (%) |
1W Chg (%) |
1M Chg (%) |
Ytd Chg (%) |
Turnover (HK$m) |
FY1 P/E |
FY2 P/E |
| COSCO Pacific |
1199.HK |
11.060 |
(7.2) |
(5.3) |
5.0 |
4.1 |
146.9 |
7.3 |
11.1 |
| Esprit |
330.HK |
11.660 |
(7.2) |
(10.9) |
(14.1) |
8.6 |
424.6 |
169.0 |
31.2 |
| Tingyi |
322.HK |
20.900 |
(4.1) |
7.7 |
7.5 |
(3.0) |
406.6 |
34.6 |
27.8 |
| Shanghai Industrial |
363.HK |
26.250 |
(2.8) |
2.9 |
8.9 |
(3.7) |
76.5 |
10.5 |
9.8 |
| Brilliance China |
107.HK |
5.340 |
(2.1) |
0.2 |
8.8 |
(14.2) |
60.0 |
2.2 |
3.2 |
Market Valuations and Earnings Growth
| Index |
FY13E P/E |
Long-term Avg. Fwd. P/E |
Deviation (%) |
FY1 EPS Growth (%) |
FY2 EPS Growth (%) |
| HSI |
11.0 |
14.1 |
(21.8) |
(3.8) |
7.8 |
| HSCEI |
8.0 |
13.5 |
(40.5) |
5.5 |
8.8 |
| Shanghai Composite |
9.9 |
18.0 |
(45.1) |
18.8 |
12.9 |
| S&P 500 |
15.2 |
14.5 |
5.4 |
6.0 |
10.9 |
Key Insights
- The Hang Seng Index (HSI) formed an uptrend and edged near the 23,000 level.
- China's economic data aligned with market expectations, supporting a positive outlook for the market.
- The green policy initiatives in China are expected to benefit certain sectors, particularly those involved in environmental protection.
- Maoye and Tianjin Capital are highlighted as potential buy candidates due to their growth potential and attractive valuations.
- The U.S. market saw a decline in crude oil and gold prices, influenced by eased tensions in Syria.
- Major ETFs showed positive performance, indicating a favorable market environment.
- The market experienced a notable increase in turnover, suggesting heightened investor activity.
Additional Highlights
- A-H Share Premium: Several companies showed significant premiums in A-shares over H-shares, indicating potential for arbitrage opportunities.
- Short Selling: The most short sold stocks included major financial institutions and technology firms, suggesting market sentiment and liquidity dynamics.
- Treasury Yields: U.S. yields remained stable, with the 2-year yield at 0.4667% and the 10-year yield at 2.9634%.
- Exchange Rates: The USD/HKD rate remained steady at 7.7546, while other currencies showed varied movements.
- Energy and Raw Materials: Prices for gold, silver, and crude oil showed declines, while copper and aluminum prices were relatively stable.
Conclusion
The investment note outlines a positive market sentiment, driven by improved economic data and green policy developments. Maoye and Tianjin Capital are recommended for purchase, with clear growth potential and attractive valuations. The U.S. market showed gains, while crude oil and gold prices fell. The Hong Kong market demonstrated increased activity, with the HSI nearing the 23,000 level. Analysts highlight the importance of monitoring upcoming company results and market valuations for further investment opportunities.
