What is the reason for the decline of LI Auto's stock? Why did Changju's stock price drop significantly? How many billion Hong Kong dollars of southbound funds have been inflowed this year?
On June 20th, according to CaiLian News, the Hong Kong stock market continued to adjust today. At one point, the technology index fell more than 2%. At the close, the Hang Seng Index fell 0.52% to 18335.32 points; the technology index fell 1.68% to 3767.88 points; the state-owned enterprise index fell 0.48% to 6556.1 points.
Note: The performance of Hang Seng Tech Index.
Institutional investors said that the cool-down of emotions in the Hong Kong stock market has largely already happened.
Despite the adjustment in the Hong Kong stock market, bullish voices still emerge in the market. For example, Haitong Securities pointed out in their recent report that the cool-down of emotions in the Hong Kong stock market has already largely happened, and the space for market adjustment may be limited.
He also pointed out that as of last week, the PETTM of the Hang Seng Index had fallen to 9.3x, and the risk premium (relative to US bonds) had risen above the 1x standard deviation below the five-year rolling mean. From the PB-ROE perspective, the Hang Seng Index and the Hang Seng China Enterprises Index are still cost-effective in major global stock indexes.
Also, the short position ratio of the Hang Seng Index last week rose to 15.3%, close to the early April level. Among them, the short position ratio of Hong Kong's Internet industry fell on a monthly basis to 0.57%, and the high-level reversal of Hong Kong's real estate (0.016%), but it still ranks at the 98.1% percentile since 2014.
Meanwhile, Yao Cheng, co-head of TMT industry research at JP Morgan Asia, expects that the stock prices of Chinese technology companies will rise by about 20% to 25%. Previously, Yao Cheng had downgraded 28 Chinese technology firms, including Tencent and Alibaba, in one go and stated that the Chinese technology industry is "not investable", which caused a huge uproar in the market.
Today's Market
From the perspective of market performance, high-dividend stocks such as shipping, petroleum, and coal performed well, while automobiles and real estate stocks fell the most.
Futures in European Line shipping have continued to strengthen, Pacific Basin Shipping rose more than 7%.
In the shipping sector, Pacific Basin Shipping (02343.HK), COSCO Ship Engy (01138.HK) and COSCO Shipping Holdings (01919.HK) rose by 7.57%, 5.31% and 3.71% respectively.
Note: performance of shipping stocks.
In terms of news, the main futures for European Line shipping have continued to strengthen, rising by 23.28% since June.
Note: The performance of the main futures for European Line shipping since June.
Galaxy Futures pointed out that in terms of dry bulk transportation, overseas port iron ore inventories are high, recent Brazilian and Australian iron ore shipments have increased, China's import of thermal coal is good, import of coking coal is average, and India's high temperatures are expected to catalyze the import of thermal coal. It is expected that short-term dry bulk freight rates will fluctuate strongly.
Original oil product accelerating rebound as summer demand peak approaches, CNOOC rose more than 3%
In petroleum stocks, CNOOC (00883.HK), PetroChina (00857.HK), Sinopec Corp (00386.HK) rose by 3.52%, 2.36%, and 1.86% respectively.
Note: Performance of petroleum stocks.
In terms of news, international oil prices have accelerated rebound this week, rising to the highest point since May. As of June 19th, Brent crude oil futures for August settlement remained above $85 per barrel. Last week, OPEC released its monthly report, maintaining its forecast for global economic growth and oil demand in 2024 and 2025 and supporting oil price action. In addition, the OPEC+ meeting statement agreed to extend the collective crude oil production reduction plan until 2025.
From a short-term perspective, the market's focus on petroleum stocks has shifted to the supply-demand gap in the third quarter and the upcoming summer oil consumption peak season. According to a previous report by Haitong Futures, on the demand side, US crude oil table demand is expected to recover and is highly seasonal. It is expected that traffic flow will continue to increase after the start of the summer driving season.
Performance positives stimulate coal industry concept stocks, Nan Nan Resources rose more than 30%.
In the coal industry sector, Nan Nan Resources (01229.HK), Mongolia Energy (00276.HK), and China Coal Energy (01898.HK) rose by 32.67%, 20.55%, and 4.51% respectively.
Note: Performance of coal mining stocks.
Speaking of the news, Nan Nan Res stated in yesterday's post-market announcement that it is expected to have a post-tax profit of no less than HKD 36 million in the 2024 fiscal year (ending on March 31, 2024), reversing the loss of post-tax HKD 59.04 million in the 2023 fiscal year.
The sharp rise in the stock prices of Mongolia Energy is due to significant increases in performance. According to an announcement last night, the company announced its performance for the fiscal year 2024 (ended on March 31, 2024), with revenue of HK$3.173 billion, a year-on-year increase of 9.22%; the profit attributable to owners of the company was HK$1.678 billion, compared with a loss of HK$1.603 billion in the same period last year.
Most automobile stocks have fallen, Li Auto fell nearly 4%
Among auto stocks, Brilliance China (01114.HK), Li Auto Inc.-W (02015.HK), and Leapmotor International (09863.HK) fell by 3.86%, 3.72%, and 3.05%, respectively.
Note: Performance of auto stocks.
In terms of news, according to the European Automobile Manufacturers' Association, new car registrations in May fell to 1.09 million vehicles, down 2.6% year-on-year, with sales in several major markets declining. In addition, in the previous month, plug-in hybrid car sales in Europe fell 9.6%, electric car sales decreased by 11%, and the proportion of electric cars in total car sales in the region dropped by one percentage point to 14%. Germany, Sweden, Norway and other markets have seen double-digit declines.
Li Auto Inc.-W had the largest decline. In terms of news, JPMorgan said that Li Auto's current stock price reflects the potential for a rise in the next 6-9 months and the adverse factors of sales and profit margins, and first gave a 'neutral' rating with a target price of HKD82. The bank believes that Li Auto's positive factors have decreased and the bearish factors have increased.
Most real estate stocks are down, with Jinhui Holdings (09993.HK) falling nearly 7%.
Among real estate stocks, Jinhui Holdings (09993.HK), Agile Group Holdings Limited (03383.HK), and Longfor Group Holdings Limited (00960.HK) fell by 6.76%, 5.56%, and 5.32%, respectively.
Note: performance of real estate stocks.
In terms of news, CMB International stated that China's real estate industry data from the National Bureau of Statistics in May weakened as expected. The year-on-year decline in development investment was -10.1%, which was 0.3 percentage points wider than the -9.8% decrease in April 2021, mainly due to weak land acquisition and new construction.
Southbound funds.
Today, there was a net inflow of HKD7.53 billion from Southbound funds. Since the beginning of this year, a total of HKD3,255.317 billion has flowed into the Southbound.
Note: The performance of southbound funds since the beginning of this year.
News and fluctuations in individual stocks.
Changjiu Logistics and Technology Co., Ltd. (06959.HK) fell more than 60%; highly concentrated shareholding was warned.
Changjiu Logistics and Technology Co., Ltd. (06959.HK) fell 65.71% to close at HKD36. In terms of news, the Securities and Futures Commission of Hong Kong issued a notice on the 19th stating that on June 3, nine shareholders held a total of 48.739 million shares of the company, equivalent to 24.11% of the company's issued share capital. The equity, together with 150 million shares held by the chairman and CEO's family, accounted for 74.2% of the issued share capital of the company, equivalent to 98.31% of the company's issued share capital.
In view of the high concentration of shareholding in Changjiu Logistics and Technology Co., Ltd., even a small amount of share trading may cause significant fluctuations in its stock price. The Securities and Futures Commission of Hong Kong reminded shareholders and potential investors to exercise caution when buying and selling.
China Innovation Intelligent Equipment Group Limited (02121.HK) rose more than 10%. In terms of news, on March 27, China Innovation Intelligent Equipment released version 2.0 (AInno-75B) of its Intelligent Kongming Industrial Big Model and multiple large-model native applications. CSC Securities pointed out that the company upgraded the 75B Intelligent Kongming Industrial Big Model, which supports multimodal processing of text, images, videos, and industrial field CAD and motion instructions; based on multimodal big model capabilities, the company further enriched the product matrix.
In terms of news, on March 27, Innovative AI Intelligence released the AInno-75B version 2.0 of the Kung Ming industrial large model, as well as multiple large model native applications. CICC pointed out that the company upgraded the 75B AI Kung Ming industrial large model to support multimodal processing of text, images, videos, and industrial CAD and action instructions and further enriched its product matrix.