Buyback Bonanza Lifts Stocks

Key Information

Asian equities had a robust day as Japan outperformed, and Hong Kong posted its first constructive day since I arrived within the area over per week in the past.

I’ve lots to report following greater than per week in Asia, with time spent in Hong Kong and Shenzhen.

Hong Kong’s brief turnover was off day over day, although at 92% of the 1-year common following yesterday’s excessive quantity decline with Moody’s China downgrade. Moody’s transfer jogs my memory of the road from the horrible film Harley Davidson and Marlboro Man: “At all times kick a person when he’s down since you’ll by no means get a greater probability.”

Hong Kong and Mainland China benefited from a number of firms saying buybacks as administration believed their shares had been undervalued and price shopping for. Hong Kong’s most closely traded shares had been Alibaba, which fell -0.5% regardless of saying the dates for the December dividend, Tencent, which gained +0.91%, Meituan, which gained +2.07% after beforehand saying a $1 billion buyback following their share decline, AIA, which fell -0.55%, BYD, which gained +2.6% after saying a buyback. Having visited BYD’s huge Shenzhen manufacturing unit and headquarters, it’s unimaginable that the inventory is on the identical degree as in 2020 regardless of income growing six fold!

Hong Kong-listed actual property developer and conglomerate Swire Pacific jumped +17% after saying a $6 billion ($767 million) share repurchase plan. NIO’s Hong Kong shares jumped +4.87% after yesterday’s monetary outcomes versus the US ADR, which gained +3% yesterday.

Mainland traders purchased a internet $718 million value of Hong Kong ETFs and shares, with the Hong Kong Tracker ETF seeing a robust influx. China’s Social Safety Fund was within the information for growing its stake in 11 shares.

Mainland China was blended after yesterday’s fall that pushed the Shanghai Composite under the three,000 degree and the Shenzhen Composite under 1,900. Nonetheless, well-liked shares Tianqi Lithium and CATL jumped +9.49% and +2.56%, respectively. CNY and the Asia Greenback Index had been off barely versus the US greenback in a single day.

Secretary of State Blinken and Overseas Minister Wang Yi spoke by cellphone about “selling wholesome, secure and sustainable China-US relations,” in line with Reuters.

One fast takeaway on my journey: life in Hong Kong and Shenzhen appeared regular. Streets, eating places, and malls had been crowded. I’ll have loads of pictures and movies to share!

The Grasp Seng and Grasp Seng Tech indexes gained +0.83% and +1.76%, respectively, on quantity that declined -16% from yesterday, which is 92% of the 1-year common. 339 shares superior, whereas 141 declined. Fundamental Board brief turnover declined -22% from yesterday, which is 107% of the 1-year common as 20% of the amount was brief turnover (keep in mind Hong Kong brief turnover contains ETF brief quantity, which is pushed by market makers’ ETF hedging). The expansion issue and small caps outperformed the worth issue and huge caps. The highest-performing sectors had been expertise, which gained +2.64%, communication companies, which gained +1.71%, and utilities, which gained +1.22%. In the meantime, vitality and shopper staples had been off -0.33% and -0.42%, respectively. The highest-performing subsectors had been media, technical {hardware}, and semiconductors. In the meantime, healthcare and vitality had been the worst-performing. Southbound Inventory Join volumes had been mild as Mainland traders purchased a internet $718 million value of Hong Kong-listed shares and ETFs, together with the Hong Kong Tracker ETF, which noticed a average influx whereas Tencent had a small internet promote.

Shanghai, Shenzhen, and the STAR Board diverged to shut -0.11%, +0.55%, and +0.35%, respectively, on quantity that decreased -0.52% from yesterday, which is 94% of the 1-year common. 3,138 shares superior, whereas 1,636 shares declined. The expansion issue and small caps outperformed the worth issue and huge caps. The highest-performing sectors had been communication companies, which gained +0.92%, Supplies, which gained +0.88%, and actual property, which gained +0.84%. In the meantime, the worst-performing sectors had been Vitality, which fell -0.91%, Utilities, which fell -0.64%, and financials, which fell -0.61%. The highest-performing subsectors had been agriculture, web, and cultural media. In the meantime, telecom, marine business, and mushy drinks had been among the many worst-performing. Northbound Inventory Join volumes had been mild/average as international traders purchased a internet $327 million value of Mainland shares, together with Tianqi Lithium, Mindray, and CATL. In the meantime, Kunlun, Wuliangye and Cypc had been small internet sells. CNY and the Asia Greenback Index had been off barely versus the US greenback. Copper fell and metal gained.

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Final Evening’s Efficiency

Final Evening’s Trade Charges, Costs, & Yields

• CNY per USD 7.15 versus 7.14 yesterday
• CNY per EUR 7.72 versus 7.73 yesterday
• Yield on 10-Yr Authorities Bond 2.67% versus 2.67% yesterday
• Yield on 10-Yr China Growth Financial institution Bond 2.78% versus 2.78% yesterday
• Copper Value -0.70%
• Metal Value +0.23%