Hong Kong Internet Rally Goes Free Solo On The Wall Of Worry - Forbes

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Asian equities were mixed/mainly lower, arsenic Hong Kong outperformed significantly, India managed a tiny gain, and the Philippines closed for the Feast of the Immaculate Conception. Asia investors cheered the 10 measures that dial backmost COVID restrictions and the beardown connection from the Mainland media pursuing the Politburo meeting, which bears repeating, “… the betterment of user request is peculiarly captious to economical growth, and depletion is straight related to epidemic prevention policies.”

Although a pullback successful US-listed Chinese stocks occurred, Hong Kong net stocks had a beardown day, with Hong Kong’s astir heavy traded by value, Tencent +5.73%, Meituan +6.45%, and Alibaba HK +5.11%. Several companies had precise beardown days, specified arsenic Kuaishou +11.08%, Alibaba Health +16.06%, JD Health +12.19%, and Bilibili HK +22.01%, indicating shorts are inactive being tally over.

I mentioned yesterday that CNY, China’s currency, has been stable, indicating a conducive situation for Chinese stocks. Watching fiscal tv earlier this week, erstwhile asked, the 4 nonrecreational portfolio managers connected the amusement each said China was “uninvestable.” Good! Stay connected the sidelines arsenic the symptom commercialized is higher with CEWC and the imaginable for an ADR delisting solution providing imaginable catalysts! Worth noting that accelerating the ADR delisting was not included successful the defence fund (NDAA), according to a DC source. Mainland China was level overnight, with existent property outperforming arsenic the CSRC Vice Chairman Li Chao and Shanghai Stock Exchange General Manager Cai Jianchun spoke astir accelerating the rollout of REITs astatine a conference. Issuing REITs would supply different financing instrumentality for distressed spot developers. From a quality perspective, President Xi visited Saudi Arabia and Hello Group (ticker MOMO) bushed expert estimates connected gross and adjusted nett income though adjusted EPS was missing. There were 4,031 caller COVID cases and 17,134 asymptomatic cases though our Major City Mobility Tracker is showing a pick-up successful subway postulation (see below).

Sun Yu of Bridgewater’s China team, the world’s largest hedge fund, garnered attraction successful Mainland media for an interrogation successful which she noted a reasonably pessimistic outlook for the US, Europe, and the UK owed to recognition liquidity tightening and the hazard of stagflation though “China is wholly different. China is (in) the signifier of liquidity betterment and economical support. In the future, policies are much supportive of the economy, and the aboriginal maturation comes from home depletion and exertion development…it is much charismatic to stocks.”

The Hang Seng and Hang Seng Tech gained +3.38% and +6.64% connected measurement -22.53% from yesterday, which is 130% of the 1-year average. 454 stocks advanced, portion 46 stocks declined. Main Board abbreviated turnover declined -21.81% from yesterday, which is 111% of the 1-year average, arsenic 15% of turnover was abbreviated turnover. Growth factors edged retired worth factors though mixed, arsenic tiny caps outperformed ample caps. The apical sectors were healthcare +6.2%, connection +6.12%, and discretionary +5.6%, portion vigor was the lone down assemblage -0.73%. The apical sub-sectors were healthcare equipment, user services, and software, portion telecom and vigor were off. Southbound Stock Connect volumes were elevated/nearly 2X the 1-year mean arsenic Mainland investors sold -$54mm of Hong Kong stocks with Tencent, Meituan, Kuaishou, and XPeng, each tiny nett buys.

Shanghai, Shenzhen, and STAR Board were disconnected -0.07%, -0.32%, and -0.32% connected measurement -8.46% from yesterday, which is 91% of the 1-year average. 1,602 stocks advanced, portion 3,005 stocks declined. Value factors outperformed maturation factors, portion ample caps outpaced tiny caps. The apical sectors were existent property +2.68%, connection +1.09%, and financials +0.51%, portion tech -0.71%, utilities -0.49%, and vigor -0.44%. Top sub-sectors were existent estate, education, and household products, portion diversified financials, agriculture, and machine hardware were among the worst. Northbound Stock Connect volumes were moderate/high arsenic overseas investors bought $16mm of Mainland stocks with a penchant for Shenzhen/growth stocks implicit Shanghai/value stocks. CNY was disconnected somewhat versus the US dollar -0.05% to 6.97, the Treasury output curve steepened, and copper gained +0.24%.

Major Chinese City Mobility Tracker

Traffic trends person remained unchangeable though subway postulation continues to uptick. The second indicates higher tolerance for comingling connected crowded subway cars.

Last Night's Performance

Last Night’s Exchange Rates, Prices, & Yields

• CNY per USD 6.97 versus 6.98 yesterday
• CNY per EUR 7.32 versus 7.33 yesterday
• Yield connected 10-Year Government Bond 2.89% versus 2.87% yesterday
• Yield connected 10-Year China Development Bank Bond 3.03% versus 3.02% yesterday
• Copper Price +0.24% overnight