KGI Asia Commentary
Hang Seng Index f rose 167 points on Monday
The Hang Seng Index opened 38 points lower to 20,681 points. Driven by various industry news, it turned up 167 points to 20,887 points throughout the day. The China Enterprises Index rose 73 points or 1% to 7,063 point; the Hang Seng Technology Index rose 54 points or 1.3% to 4,311 point. The market turnover was HK$112.1 bn. Hong Kong stocks performed well today. Telecom stocks were boosted by AI technology. China Telecom (728) rose 3.8%. Infrastructure stocks were affected by the positive expectations for the upcoming NPC and CPPCC meeting. China Hongqiao (1378) rose nearly 10%. Chinese securities companies stock price were driven by China's relaxation of overseas listing restrictions. CICC (3908) rose 4.6%.
U.S. president makes surprise visit to Ukraine to show support
There may be a new breakthrough in the Russia-Ukraine war. According to foreign media reports, on the occasion of the first anniversary of the war, U.S. President Joe Biden made a surprise visit to Kiev, the capital of Ukraine, yesterday to show U.S. support for Ukraine. The U.S. has publicly supported Ukraine with actions, or it will provide Ukraine with more powerful weapons to deal with Russia's coming counterattacks. This may increase the US defense budget, which will benefit the defense sector.
U.S. stock markets closed on Monday for Presidents’ Day.
Chinese economy is set to a good start this year
After Chinese economy restarted in December last year, covid-19 cases were peaked in January. Some leading indicators reflected the real economy rebounded rapidly. Foreign direct investment (FDI) amounted to RMb127.7bn in January this year, an increase of 14.5% YoY. Among them, the high-tech manufacturing industry grew the fastest, with an annual increase of 74.5%. In addition, the mainland’s new society finance in January reached a new high of RMb4.9tn. PBOC intends to take action to cool down, which hopes that commercial banks will moderately control the scale of loans in February and smooth the overall lending. This all reflects that the balance sheet of the private sector has also begun to expand.
Hong Kong Stock Connect had a net outflow of HK$5.75bn on Friday, of which China Mobile (0941) had the largest net inflow of HK$853mn; followed by WuXi Biologics (2269). Tracker Fund (2800) recorded the largest net outflow of HK$4.80bn; followed by Hang Seng China Enterprises (2828).
Wen Kit Kenny is a SFC licensed person accredited to KGI Group to carry on regulated activities (for details, please refer to:https://apps.sfc.hk/publicregWeb/indi/AJF244/details). He and/or his associate do not have any financial interest in the recommended issuer or new listing applicant.
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