20160317-新鸿基金融集团-INVESTMENT_DAILY_NOTE_14页_2mb

Investment Daily Note Summary

Core Content Overview

This daily note provides an overview of the Hong Kong and global financial markets, including key indices, stock performance, sector analysis, valuations, and market conditions such as interest rates, exchange rates, precious metals, and commodities. It also highlights stocks to watch and investment strategies based on current market trends.

Main Points

Market Highlights

• The Federal Reserve kept interest rates unchanged but reduced the projected rate hikes to just two by year-end, signaling a more dovish stance.
• US stocks closed higher, with the Dow and S&P 500 reaching their year highs.
• ADRs showed positive performance, contributing to a projected increase in the Hang Seng Index (HSI).
• Oil prices rose due to lower-than-expected US crude stock increases and news of potential output freezes by major producers.
• Gold prices slightly declined, while other commodities showed mixed results.

Hong Kong Market Performance

• The HSI closed at 20,257, down 31 points, reflecting minor consolidation.
• The HSCEI dropped 34 points to 8,571, indicating a bearish trend.
• The Main Board turnover was HK$58.6bn.
• Dividend stocks were in demand, with HKT SS (6823.HK) and Link REIT (823.HK) showing positive performance.
• Power Assets (6.HK) saw a sharp decline due to disappointing net profit figures.

Stock in Focus: PING AN-H (2318.HK)

• Last Close: HK$35.30
• Entry: HK$32.70
• Target: HK$44.20
• Stop-loss: HK$30.00
• YTD/1M/3M/12M % Change: -17.9% / 7.5% / -17.2% / -18.7%
• Market Cap: HK$679.78bn
• 3M Average Daily Volume: 36.45mn shares
• FY1 Forward P/E: 9.5
• Key Insights:
  • Ping An Insurance reported strong 2015 results with revenue and net profit up 30.8% and 38% respectively.
  • The company's health insurance segment showed significant growth, with premiums increasing 43.3% YoY in January and February 2016.
  • The share price is not reflecting these positive trends, suggesting a potential buying opportunity.

Today's Top Picks

1. Sino Biopharm (1177.HK)

   • Last Close: HK$5.51
   • Entry: Current
   • Target: HK$6.25
   • Stop-loss: HK$5.23
   • Reason: Share price bottomed out and showed support, expected to test the 150-day moving average.

2. UCD (1599.HK)

   • Last Close: HK$3.95
   • Entry: Current
   • Target: HK$4.40
   • Stop-loss: HK$3.76
   • Reason: Long-term prospects, share price expected to break through the 50-day moving average.

Sector Performance

• Top Performing Sectors:

  • HK Telecoms: +1.8% (5D: +3.0%, 1M: +6.2%)
  • REITs: +1.0% (5D: +2.1%, 1M: +8.4%)
  • Telecoms Equipment: +0.5% (5D: -0.9%, 1M: +7.6%)
  • Dairy: +0.4% (5D: -0.2%, 1M: +2.4%)
  • Local Property: +0.4% (5D: +1.2%, 1M: +12.6%)
  • Chinese Banks: +0.2% (5D: +1.7%, 1M: +8.3%)
  • Sports Accessories: +0.1% (5D: +1.1%, 1M: +2.1%)

• Worst Performing Sectors:

  • Department Store: -0.1% (5D: +0.6%, 1M: +2.2%)
  • Coal: -0.1% (5D: +2.5%, 1M: +18.9%)
  • Local Banks: -0.2% (5D: +0.9%, 1M: +12.0%)
  • Toll Road: -0.3% (5D: +3.2%, 1M: +8.8%)
  • Building Materials: -0.3% (5D: +1.5%, 1M: +11.7%)

Valuations and Forward P/E

• Hang Seng Index (HSI): FY16E P/E 10.7, Long-term avg. fwd. P/E 11.0, Deviation from avg. -2.2%
• HSCEI: FY16E P/E 6.8, Long-term avg. fwd. P/E 7.9, Deviation from avg. -14.0%
• Shanghai Composite: FY16E P/E 12.3, Long-term avg. fwd. P/E 10.7, Deviation from avg. +14.2%
• S&P 500: FY16E P/E 17.1, Long-term avg. fwd. P/E 15.3, Deviation from avg. +11.6%

Market Data

• Best Performers:

  • SIHUAN PHARM (460.HK): 8.5% (1D), 17.3% (5D), -47.5% (1M), -47.5% (YTD)
  • SUNNY OPTICAL (2382.HK): 5.8% (1D), 12.9% (5D), 19.0% (1M), 14.8% (YTD)
  • ZALL DEVELOPMENT (2098.HK): 5.4% (1D), 10.8% (5D), 33.3% (1M), 9.1% (YTD)
  • XINYI GLASS (868.HK): 4.3% (1D), 9.1% (5D), 16.7% (1M), 5.5% (YTD)
  • POWERLONG REAL (1238.HK): 4.2% (1D), 8.7% (5D), 13.6% (1M), -8.5% (YTD)

• Worst Performers:

  • THE UNITED LABOR (3933.HK): -12.8% (1D), -5.3% (5D), 0.7% (1M), -33.3% (YTD)
  • PIONEER PHARM (1345.HK): -6.0% (1D), -10.2% (5D), -13.7% (1M), -43.6% (YTD)
  • COUNTRY GARDEN (2007.HK): -5.9% (1D), -8.8% (5D), 1.3% (1M), -5.3% (YTD)
  • DONGYUE GROUP (189.HK): -5.7% (1D), -7.6% (5D), -10.1% (1M), -32.5% (YTD)
  • BRILLIANCE CHINA (1114.HK): -4.9% (1D), -5.9% (5D), 1.9% (1M), -32.9% (YTD)

External Market Conditions

• Interest Rates: Fed lowered rate hike forecast to two, with US 2-year Treasury yield at 0.8510% and 10-year at 1.9134%.
• Exchange Rates: USD/HKD at 7.7578, with a slight increase of 0.1%.
• Precious Metals and Commodities: Oil prices surged, while gold slightly declined. Other commodities showed mixed results.

A-share Premium to H-share

• The table highlights the premium of A-shares over H-shares for various companies, with some showing significant premiums, indicating potential for growth or valuation discrepancies.

Key Information Summary

• Fed Policy: Kept rates unchanged, lowered rate hike forecast, and showed a dovish stance.
• HSI and HSCEI: Closed at 20,257 and 8,571 respectively, showing minor declines.
• Ping An Insurance: Strong 2015 results, significant growth in health insurance segment, and a recommended buy at HK$32.70 with a target of HK$44.20.
• Sector Analysis: Highlights top and worst performing sectors with their respective stocks.
• Market Trends: Emphasizes the importance of technical analysis and corporate news in stock selection.
• Valuation Metrics: Forward P/E and long-term average P/E for major indices.
• Market Data: Provides detailed performance metrics for both best and worst performers.
• Investment Strategy: Suggests buying stocks with support levels and potential to break through moving averages.