China International Capital Corporation stated that as the market gradually returns to fundamentals, the Hang Seng Index may oscillate near 18000 points. Semiconductors stocks rallied today due to some stimulating news.
According to Finance Association on June 17th, the performance of Hong Kong stock market was mixed today, with Hang Seng Tech Index slightly up. At the close, Hang Seng Index fell 0.03% to close at 17936.12, Tech Index rose 0.05% to close at 3709.35, and China Enterprises Index fell 0.02% to close at 6373.48.
Note: The performance of Hang Seng Tech Index.
It is worth noting that the three major indexes in the Hong Kong stock market experienced a trend of first suppressing and then rising today, especially the Hang Seng Tech Index performed significantly. The index fell 1.03% in early trading, but then fluctuated and rebounded.
How to view the Hong Kong stock market in the future?
China International Capital Corporation pointed out that as the market gradually returns to the fundamentals, the Hang Seng Index may fluctuate around 18000 points, while the market is also looking forward to new catalysts to promote further upward trends.
This brokerage predicts that policies are still expected to continue to be introduced, but "strong stimuli" are not realistic. Therefore, the market may more likely show a trend of shock consolidation in the short term. Among the three main drivers driving the market, risk premium has been repaired for most of it, the short-term space for risk-free interest rate movements is limited, and profitability is the key to opening up wider space for the market, but this is highly dependent on the opening of the credit cycle.
Today's Market
Looking at the market performance, consumer electronics and semiconductor stocks rose, while individual stocks such as petroleum, electric power, and real estate fell.
Consumer electronics stocks continue to rise, and Cowell leads its individual stocks.
Among consumer electronics stocks, Cowell (01415.HK), BYD Electronic (0285.HK), and AAC Tech (02018.HK) rose 8.30%, 6.32%, and 1.28% respectively.
Note: Performance of consumer electronics stocks.
In terms of news, Apple announced significant upgrades to Apple Intelligence and Siri at the Worldwide Developers Conference. Macquarie expects that the new Apple Intelligence features will promote updates and upgrades, and increase user stickiness.
CMB International also pointed out that due to the fact that Apple's AI function will only apply to iPhone 15 Pro or devices equipped with M1 chips and above, the bank believes that the innovation of Apple's AI function is expected to drive shorten the replacement cycle and promote the demand for new products at the autumn release conference.
TSMC plans to raise prices, SMIC up nearly 3%.
Among semiconductor stocks, SMIC (00981.HK), Shanghai Fudan (01385.HK), and Hua Hong Semi (01347.HK) rose 2.61%, 2.58%, and 1.08% respectively.
Note: Performance of semiconductor stocks
According to media reports, TSMC plans to raise prices. The price increase of 3nm foundry may be more than 5%, and advanced packaging quotation for next year is also about 10%-20%. TSMC's 3nm has fully received orders from seven major customers including Apple and Nvidia, and the expected order fulfillment will be until 2026.
Recently, oil prices fell, and Sunshine Oil Sands fell more than 8%.
Among petroleum stocks, Sunshine Oil Sands (02012.HK), Sino Oil & Gas Holdings (00702.HK), and PetroChina (00857.HK) fell 8.33%, 7.69%, and 1.71% respectively.
According to the National Development and Reform Commission, on June 13, the domestic gasoline and diesel prices (standard products, the same below) will be reduced by 190 yuan/ton and 180 yuan/ton respectively from 24:00 on June 13, 2024, in accordance with the current refined oil price formation mechanism.
According to estimates by third-party institutions, after the implementation of the refined oil price adjustment, 92nd gasoline will be reduced by 0.15 yuan/liter, 95th gasoline will be reduced by 0.15 yuan/liter, and 0th diesel will be reduced by 0.15 yuan/liter. Private car owners will spend about 7.5 yuan less when filling up a tank of fuel. Except for the high-price areas in Hainan Province and some southwestern regions, 92nd gasoline in most parts of the country will return to the "7 yuan era" again.
Most electric power stocks fell, and Hua International Power fell more than 6%.
Among electric power stocks, Hua International Power (01071.HK), China Longyuan Power (00916.HK), and Datang International Power Generation (00991.HK) fell 6.45%, 5.54%, and 3.49% respectively.
Note: Performance of electrical utilities stocks.
In terms of news, Guolian Securities released the June report on provincial power grid purchases, from the perspective of proxy purchase prices, prices increased in 13 provinces compared with May 2024, prices remained unchanged in 3 provinces, and prices fell in 16 provinces.
In addition, China Securities Co., Ltd. pointed out earlier that Jiangsu's electricity price fell in June. The decline in monthly long-term contract electricity prices was mainly affected by the power supply and demand situation and the decline in coal prices. Considering the unchanged locking effect of annual long-term contract electricity prices, under this background, the monthly electricity price has a slight downward trend, and they believe that there is no need to overly worry about the profitability of coal-fired power generation.
Real estate developers' funds in place in the first five months fell by more than 20% YoY, and Shimao Group fell by more than 8%.
Among real estate stocks, Shimao Group (00813.HK), Sino-Ocean GP (03377.HK) and Agile Group (02777.HK) fell by 8.24%, 8.08% and 6.38%, respectively.
Note: performance of real estate stocks.
In terms of news, data from the National Bureau of Statistics shows that in the first five months, real estate development enterprises' funds in place amounted to 4.2571 trillion yuan, a YoY decrease of 24.3%. Among them, domestic loans amounted to 681 billion yuan, down 6.2%; the utilization of foreign capital was 1.1 billion yuan, a decrease of 20.3%; self-raised funds amounted to 1.4816 trillion yuan, down 9.8%; deposits and prepayments amounted to 1.2584 trillion yuan, down 36.7%; individual mortgage loans amounted to 619.1 billion yuan, down 40.2%.
Southbound funds.
Today, there continues to be net inflows of southbound funds, with the amount reaching 3.708 billion Hong Kong dollars. Since the beginning of this year, southbound funds have cumulatively flowed into Hong Kong by over 300 billion Hong Kong dollars.
Note: The performance of southbound funds since the beginning of this year.
News and fluctuations in individual stocks.
Brilliance Chi rose nearly 19%, and will declare a special dividend soon.
Brilliance Chi (01114.HK) rose by 18.79%, closing at 8.47 Hong Kong dollars. In terms of news, the company will ex-dividend and go ex-rights on July 3, 2024, and pay a special dividend of 4.3 HKD per share. The relevant record date for dividend distribution is July 4, 2024, ex-dividend on July 3, 2024, and payment date on July 25, 2024.
Meituan rose nearly 2%, and BofA Securities reiterated a 'buy' rating.
Meituan-W (03690.HK) rose by 1.83% and closed at 116.8 Hong Kong dollars. In terms of news, BofA Securities released a research report stating that it raised Meituan-W's target price by 5.2%, from 135 Hong Kong dollars to 142 Hong Kong dollars, and raised the profit forecast for 2024-2026 by 3%-6% due to better profit trends. It reiterated a 'buy' rating, mainly benefiting from optimistic core business trends and stable competition.