CHINA Stock Market Analysis

[tiny]

http://www.channelnewsasia.com/mobile/asiapacific/china-manufacturing-index/2308562.html

 

[Shiny Things]

need Shiny Things to chip in on this...

share your thoughts please, ST, if u are reading this!

No, nobody has ever done this except loony retail investors who think "reserve currency" means something. You're welcome.

 

[Shiny Things]

the Yuan becoming a reserve currency is pretty inevitable.

but... may I ask, what are it's implications, as relevant to the stock markets?

does this mean that chinese stocks would be more bullish, from it, as a sign of credibility or?

Mate, pretty much every single question you've asked over the last week or so has been some variant of "I want to buy Chinese stocks but I want someone else to validate my decision".

I'm not going to do that - I think the risk-reward on Chinese equities is pretty miserable at these levels. But maybe you should just buy some and see what happens. I might be wrong.

 

[peterchan75]

Now that TS has fishing rod, the bait just need hit the water. Fishes do not have lung.

 

[newjersey]

hi Shiny Things,

thanks for sharing your thoughts.



I would keep u guys updated on my venture.

 

[newjersey]

no one keen on china shares or shares that's based on china's growth?

let's discuss here.

 

[Perisher]

no one keen on china shares or shares that's based on china's growth?

let's discuss here.

I think most who posted here have at least a bit of interest...

 

[newjersey]

there has been alot of movement in the BAT counters...

hope to discuss it with anyone keen.

 

[newjersey]

can share your views on iShares China Large Cap ETF too...

 

[newjersey]

MSCI just bought lots of China Tech stocks... on 30 Nov 2015 !!!

any thoughts on it?

 

[Perisher]

China slowdown hits home for multinational industrials
http://asia.nikkei.com/Business/Trends/China-slowdown-hits-home-for-multinational-industrials

TOKYO -- From the West to Asia, global industrial companies are feeling the weight of China's slowing economy, even as consumer-oriented businesses experience success in that country.

Of 300 U.S. companies with high market capitalization, sales at the 135 with Chinese operations fell 6% on the year in the July-September quarter and 2% from the preceding three months, data from Nikkei's QUICK and FactSet Research Systems shows.

Suppliers of infrastructure and machinery had a particularly bad quarter, and their woes continue. Caterpillar's net profit tumbled 60% on the year as sales of construction and mining equipment slumped. The U.S. manufacturer expects sales to fall 5% next year, and it is moving to cut 10,000 jobs as it describes Chinese demand as the lowest in the past 10 years.

General Electric's infrastructure orders for the Asia region dropped 6% to $3.3 billion. Orders for public works have declined, said Jeffrey Bornstein, chief financial officer. In China, GE faces public investment cutbacks by financially troubled local governments. DuPont's Chinese sales are down amid stagnant demand for solar panel materials.

China's loss of steam also is sapping European and Asian multinationals. German group BASF's chemical sales are depressed. Taiwan Semiconductor Manufacturing Co. is seeing less demand for smartphone chips. Shipbuilder Hyundai Heavy Industries posted an operating loss for the July-September quarter.

Japanese industry, too, has a China problem. The components of the Nikkei China Related Stock 50 index swung to a 3% net profit decline in the July-September period from a 19% gain in the prior quarter. SMC, the world leader in air compressors, is rethinking factory construction plans amid poor sales to the electronics and automotive industries. Mitsubishi Electric's factory equipment and elevator businesses are affected by China's slowdown.

Full article in above link.

 

[Perisher]

China approves IPO reform proposal
http://www.businesstimes.com.sg/government-economy/china-approves-ipo-reform-proposal

China's top legislature on Sunday approved a proposal to revamp the country's initial public offering (IPO) system, authorising the government to implement changes to the system that could be in place as early as March, the official Xinhua news agency said.

The State Council, or Cabinet, had been awaiting approval on its plans to shift to a US-style registration system for stock market flotations.

In the latest reform aimed at developing China's financial market, the changes are expected to help companies raise money more efficiently and reduce the involvement of regulators in the capital market.

The next step for the State Council is to come up with specific details of the new IPO system. The Cabinet could do so and implement a new IPO mechanism as early as on March 1 next year, Xinhua reported. However, the state council has two years from March to do so.

The State Council said earlier this month it expects the new system to be implemented within two years.

The China Securities Regulatory Commission (CSRC) began speaking of moving away from its current approval-based system - seen as distorting the IPO market and encouraging official corruption - to a registration system, where the market decides who gets to list and for how much, in early 2014.

But the stock market crash that began in mid-June, blamed in part on an IPO glut hitting the market, put that process on hold as the CSRC froze new listings to stabilise a market that lost as much as 40 percent in just a few weeks.

After a pause of more than three months beginning in July, IPOs were finally allowed to resume over the past several weeks.

Full article in above link.

 

[Perisher]

AIIB formally set up, first loan expected in mid-2016
http://business.asiaone.com/news/aiib-formally-set-first-loan-expected-mid-2016

The Asian Infrastructure Investment Bank will convene next month for the first time since its establishment and will elect its first president, according to the Ministry of Finance.

AIIB formally set up, first loan expected in mid-2016 Lou Jiwei, finance minister

The schedule was revealed on Friday, when the bank was formally established. The ministry said in a statement that the bank has garnered the approval of 17 countries, representing 50.1 per cent of the total subscribed capital.

The bank's charter stipulates that the AIIB is legally valid so long as more than 10 countries－with their combined represented capital accounting for no less than half of the total capital－have the charter approved by their legislatures.

The 17 countries include major economies such as Australia, the United Kingdom, South Korea and Germany.

Other major economies, such as Brazil, Russia and India, have not yet approved the charter, known formally as the articles of agreement.

The bank's board of governors and board of directors will convene from Jan 16 to 18 in Beijing, marking the start of the bank's formal operations, the ministry said.

Lou said that along with other countries, China will perfect the rules in a runup to granting the first loan, which is expected in mid-2016.

There are 57 prospective founding members. Those who have not approved the charter by the time the bank convenes in January could still participate in the two gatherings as representatives, but not as governors or directors, a staff member of the ministry said.

They will have a "grace period" until the end of 2016 to approve the charter and become formal members.

After the bank becomes operational, countries can still apply for membership and join the $100 billion bank as long as the board of governors approves the application.

At the convention in January, a president will be elected as well as 12 directors for each electoral region. China holds 26.1 per cent of the voting rights and has veto power over these decisions.

Jin Liqun, China's candidate for president, said previously that about 30 countries are in line for membership and that this would increase the bank's capital.

Full article in above link.

 

[tanjiakpeng]

Just my 2 cents on the SDR inclusion that some peeps have mentioned

SDR inclusion means that central banks will be increasing their RMB reserve, by laws of economics i guess this would mean that demand for RMB is generally going to increase

Throwback since the beginning of 2015 (or even late 2014), PBoC has been devaluing the the RMB through CNH fixings (to decrease the spread between CNY vs CNH), and yes RMB did take a hit. Well you can see now probably, they already had the SDR inclusion in their cards, where they are expecting an appreciation in RMB 1 year down the road (pure speculation, it has not materialized, i am guessing it will take till Q1 2016), to get a small net appreciation of currency, rather than a further appreciation in currency which is going to hit their exports

So what does that mean for stocks? My take is that chinese stocks are going to rally, at least till Q1 2016, but that's my pure guess, with more prevalent use of the RMB for trade. I'm bad at picking individuals so i would put my money in 2828:HK which is the H-shares ETF that some have talked about trading in HK, which is cheaper than A-shares.

Please share your views! Worthy discussion given there's so much uncertainty when we talk about our big brother up north

 

[Mr.Canberra]

CNY

SDR inclusion means that central banks will be increasing their RMB reserve, by laws of economics i guess this would mean that demand for RMB is generally going to increase.

I'm vested in CNY. My CNY cash holdings are down against SGD lately. CNY was trading at a low of 4.46XX on 16 Nov to the current 4.59XX now.

If talking about CNY against SGD context. You can see the resistance level is around 4.61XX currently.

Short term wise SGD will appreciate slightly against CNY. Over long term wise CNY will gradually retrace it losses when officially included in SDR during Oct 2016.

Above are strictly personal opinion only.

Hahaha now I feel like an Ah Tiong. Convert CNY to SGD to spend and pay bills in Singapore. Hopefully in the near future the power of the RMB can help me to achieve Swiss standard of living which the SGD cannot help me to in Singapore.

 

[Perisher]

Just my 2 cents on the SDR inclusion that some peeps have mentioned

SDR inclusion means that central banks will be increasing their RMB reserve, by laws of economics i guess this would mean that demand for RMB is generally going to increase

Throwback since the beginning of 2015 (or even late 2014), PBoC has been devaluing the the RMB through CNH fixings (to decrease the spread between CNY vs CNH), and yes RMB did take a hit. Well you can see now probably, they already had the SDR inclusion in their cards, where they are expecting an appreciation in RMB 1 year down the road (pure speculation, it has not materialized, i am guessing it will take till Q1 2016), to get a small net appreciation of currency, rather than a further appreciation in currency which is going to hit their exports

So what does that mean for stocks? My take is that chinese stocks are going to rally, at least till Q1 2016, but that's my pure guess, with more prevalent use of the RMB for trade. I'm bad at picking individuals so i would put my money in 2828:HK which is the H-shares ETF that some have talked about trading in HK, which is cheaper than A-shares.

Please share your views! Worthy discussion given there's so much uncertainty when we talk about our big brother up north

I remember a few members here have stakes in HK ETF too.
I was interested to buy until the number of shares got me confused.

 

[Mr.Canberra]

I remember a few members here have stakes in HK ETF too.
I was interested to buy until the number of shares got me confused.

Hold HKD is good now as pegged to USD. Long term wise USD will gradually get stronger.

Personally will hold CNY, HKD and USD to hedge against SGD to insure my purchasing power.

Count on SGD to achieve Swiss standard of living is very slow and difficult.

 

[tanjiakpeng]

Hold HKD is good now as pegged to USD. Long term wise USD will gradually get stronger.

Personally will hold CNY, HKD and USD to hedge against SGD to insure my purchasing power.

Count on SGD to achieve Swiss standard of living is very slow and difficult.

+1 for chiu. my sentiments exactly. USD is def gona appreciate against most asian currencies given the rate increase. can be vested in both US or China stocks if you are anxious to achieve both FX gain and stock gains

 

[tanjiakpeng]

http://www.bloomberg.com/news/artic...ck-sales-by-major-shareholders-for-six-months

the date is Friday to watch, 8 January, 6 mths after the ban was imposed. with the direction that the market is going, i guess it is only going south

 

[tiny]

http://www.bloomberg.com/news/artic...ck-sales-by-major-shareholders-for-six-months

the date is Friday to watch, 8 January, 6 mths after the ban was imposed. with the direction that the market is going, i guess it is only going south