20171106-兴业证券-A-Share_Daily_Express_5页_474kb

Summary of Industrial Securities Co., Ltd. Report

Core Content

This report provides an overview of the Chinese stock market performance and investment outlook for the A-share market, with a focus on growth stocks. It includes market indices, sector performance, company news, and research insights.

Market Indices

Total Market Volume: CNY 465.01 billion (USD 70.08 billion), down 0.1% from the previous session.

Market Performance

• Overall Trend: China stocks rallied on Monday, with most names higher at close.
• Sector Dynamics: Winners outnumbered losers by 2402-to-732.
• Financial Sector: Financial blue chips and real estate and construction stocks saw extended corrections.
• Convertible Bonds: Two convertible bonds opened for IPO subscription today, with another on Wednesday. Five more applications are under regulatory review, which may cause a crowding-out effect in the next few weeks.

Sector Review

Winners

• Home Appliances: Midea Group Co. (000333) +4.03%; Qingdao Haier Co. (600690) +6.71%
• Food and Beverage: Kweichow Moutai Co. (600519) +2.17%; Inner Mongolia Yili Industrial Group Co. (600887) +4.35%
• Electronics: BOE Technology Group Co. (000725) +8.82%; Sanan Optoelectronics Co. (600703) +8.01%

Losers

• Banking: Industrial and Commercial Bank of China Limited (601398) -0.82%; China Merchants Bank Co. (600036) -1.66%
• Real Estate Developers: China Vanke Co. (000002) -2.59%; Poly Real Estate Group Co. (600048) -2.63%

Daily Headlines

• Financial System Vulnerability: Central Bank Governor Zhou Xiaochuan warns of high leverage and the need for deeper reforms.
• Xiaomi's Revenue Forecast: Lei Jun, Xiaomi's co-founder and CEO, predicts annual revenue reaching 1 trillion yuan in 10 years.
• China Telecom's Investment: China Telecom may invest up to 20 billion reais in Brazil’s Oi.
• Hong Kong Property Prices: Secondary private residential property prices in Hong Kong fell 0.7% over the week.
• PetroChina's Price Hike: PetroChina is expanding its seasonal natural gas price increase.
• Mutual Funds Shift: Mainland Chinese mutual funds increased holdings in technology and consumer discretionary shares in Hong Kong.
• Legal Updates: Merchants may face fines up to 2 million yuan for fraudulent or misleading advertising.

Latest Company News

• Agile Group: Oct. Pre-Sales Value 6.5B Yuan
• ASM Pacific: Urged to sell shares by Elliott and Eminence
• CCB: Signs 50B Yuan Deleveraging Service Pact with Yunnan SASAC
• China Hongqiao: Interim injunction filed against Emerson
• China Modern Dairy: 300M Yuan 3Y Loan Draws Seven Banks
• CITIC Securities: Plans to sell up to 18.9M A Shares
• ENN Energy: Raises Natgas Prices in 3 China Provinces From Nov.
• Fosun Int'l: Names Allgeier as Chief Investment Officer
• Greenland: Signs about 100B Yuan Contracts with Xi’an
• Legend Holdings: EU Clears Legend Holdings/BIL Deal
• PetroChina: Said to raise Natgas Price From Nov.1 TO March 31
• SOHO China: Enters Agreement for $400 Million Syndicated Loan
• Standard Chartered: Early Talks for $350M Loan Refinancing
• ZTE: InterDigital Trial Victory Over ZTE Affirmed on Appeal

Market Outlook

• Growth Stocks: Increasing allocation value due to policy support, potential return to A-share market, and reasonable PE ratios.
• Key Sectors: Innovation in network technology, big data, and AI is supported by policy. Semiconductor, 5G, environmental protection, and military industry are recommended.
• Financial Sector: Banks (stabilized NIM and non-performing loans), insurance companies (consumption upgrade), and security brokers (to bottom out) are highlighted.
• Core Assets: Government focus on quality over speed of economic growth, benefiting "White Horse" stocks and advanced manufacturing.
• Theme Investment: SOE reform, integration of Beijing, Tianjin, and Hebei, AI, and 5G are recommended themes.

Investment Rating Definitions

Industry Investment Rating

• Overweight: Industry outperforms the market
• Neutral: Industry performs about the same as the market
• Underweight: Industry underperforms the market

Company Investment Rating

• Buy: Company outperforms the market by more than 15%
• Outperform: Company outperforms the market by 5% to 15%
• Neutral: Company outperforms or underperforms the market by less than 5%
• Underperform: Company underperforms the market by more than 5%

Information Disclosure

Industrial Securities Co., Ltd. discloses information within its sphere of knowledge. Clients can visit the Insider Trading Prevention and Control column at www.xyzq.com.cn for details on the quiet period and affiliate holdings.

Disclaimer

• The report is for the Company's clients only.
• The views in the report may change and are not guaranteed.
• The Company may trade stocks of companies it provides investment banking services to.
• Unauthorized redistribution is prohibited without prior consent.
• The Company reserves all rights to the report.