The Hang Seng Index performed well on the first trading day of the second half of the year. The US ISM Manufacturing PMI showed a faster contraction in manufacturing, with declining demand and employment, and price pressures easing. The Dow Jones and Nasdaq rose by 0.1% and 0.8% respectively. At the time of writing, the yield on the US 10-year Treasury bond was at 4.452 cents, with the US dollar index rising to 105.99. Dow Futures fell by 121 points or 0.3%, while Nasdaq Futures fell by 0.51%. In June, China's manufacturing PMI remained flat at 49.5 per month, in line with expectations, while Caixin China's manufacturing PMI rose to 51.8, a three-year high. The Shanghai Composite Index rose 2 points or 0.08% to close at 2997 points. The Shenzhen Component Index fell by nearly 1%, while the total turnover of the Shanghai and Shenzhen markets exceeded RMB 644.6 billion.
The Hang Seng Index opened lower by 49 points this morning, soared to a high of 17,986 points after a temporary fall, and then narrowed its gains. It rose 50 points or 0.29% throughout the day to close at 17,769 points. The H-Share Index rose 43 points or 0.68% to close at 6,374 points. The Hang Seng Technology Index fell 15 points or 0.43% to close at 3,539 points. The total turnover of the market for the whole day was HKD 118.434 billion, with a net inflow of HKD 3.696 billion and HKD 4.452 billion from southbound trading through the Shanghai and Shenzhen Stock Connect respectively.
ICBC and ABC rose, while CNOOC was favored.
Technology stocks developed separately with Alibaba (09988.HK) falling nearly 0.1% and Tencent (00700.HK) falling 0.9%. Meituan (03690.HK) rose nearly 1%. Chinese financial stocks rose, with Ping An Insurance (02318.HK) and China Life (02628.HK) gaining 2.7% and 1.6%, respectively. ICBC (01398.HK) and CMB (03968.HK) were up 2.4% and 2.7% respectively, while ABC (01288.HK) surged nearly 4.2%.
Oil prices rose to a two-month high, and Chinese oil stocks rose. CNOOC (00883.HK) rose by nearly 4.5% to close at HKD 23.4, while PetroChina (00857.HK) surged by 4.2%. BOC International predicts that China's oil industry will continue to outperform the broader market in the second half of this year. Given the global oil supply shortage, the bank expects the global oil market to experience a daily shortage of 1.4 million barrels in the second half of this year, with oil prices maintaining their strength or even rising. The bank also pointed out that CNOOC is the only Chinese oil giant that can achieve strong production growth, and is also the company with the lowest production costs and the longest crude oil reserve life in the Chinese oil sector, making it the first choice in the Chinese oil sector.
Xinyi Solar Energy (00968.HK) is expected to see its mid-term net profit increase by 35% to 45% year-on-year, but the group said that its performance for the first half of this year is expected to be below that of the six months ending December 31, 2023. Its stock price fell 5.6% throughout the day, making it the worst performing blue chip stock. Morgan Stanley said that the company's first half performance guidance was roughly in line with expectations, but considering the weak industry fundamentals and the short-term decline in solar glass prices, Xinyi Solar Energy's profits may come under pressure in the second half of the year.
The Hong Kong stock market turned weak today, with a ratio of 18:23 (up from 23:19 yesterday) for the rise and fall of main board stocks, with 1,007 stocks falling (a decline of 3.3%). Today, 36 Hang Seng constituent stocks rose and 44 fell, with a rise/fall ratio of 44:54 (compared to 42:52 yesterday). The market recorded a net short sale of HKD 18.236 billion today, accounting for 17.176% of the turnover of the available shortable shares, or HKD 106.172 billion (compared to 19.5% yesterday).