To The Moon

Are china stocks the future?

Debt yields continue to rise, aesthetic stocks are up, the Hang Seng index regains 22,000

Good afternoon everyone, the Federal Reserve continued to release hawkish remarks and the bond interest rate rose, but with the support of the easing of the situation in Russia and Ukraine, the US stock market still performed well throughout the day. The Dow rose 254 points to 34807 points; the SSI rose 50 points Reported 4511 points; the Nasdaq also rose 270 points to 14108 points.

In addition to Fed Chairman Powell's openness to raising interest rates by half a percentage point, Cleveland Fed President Mester also expects the federal funds rate to rise to 2.5% by the end of this year (that is, two rate hikes of 0.5%). And St. Louis Fed President Bullard, who has always been aggressive in raising interest rates, reiterated his proposal to increase interest rates to 3% this year (that is equivalent to raising interest rates every time, and several times the rate is greater than 0.25%). And the US bond interest rate is also Immediate reaction, the US 10-year bond interest rate has risen to 2.38% yesterday (the highest is more than 2.39%). However, the market also has certain doubts about the repeated interest rate hikes. Long-term bond interest rates (10-year, 20-year and 30-year ) continued to narrow.

However, the author mentioned in the pre-market communication on Monday that there is still some time before the interest rate meeting in May. Even though bureau officials continue to prepare for market adjustment, the short-term future of the stock market is still focused on the situation in Russia and Ukraine. It is rumored that there are differences within the EU on sanctions against Russian oil, and Ukrainian President Volodymyr Zelensky is also ready to make a promise that Ukraine will not seek to join NATO in exchange for a ceasefire and the withdrawal of Russian troops. The re-emergence of the ceasefire also has an immediate effect on US stocks.

The market expects that Evergrande's investor conference call will come out with good news. Real estate stocks surged to support the performance of the Shanghai Stock Exchange. However, the pharmaceutical and semiconductor sectors did not meet expectations to limit the market's uptrend, and the Shenzhen Stock Exchange was still going to end lower. 0.19% to 3259 points; Shenzhen Stock Exchange fell 0.49% to 12318 points. The total turnover of the two cities fell to 962.8 billion, and foreign capital recorded a net outflow of 922 million through the Mainland Stock Connect. The outflow continued but moderated.

Yesterday, it was reported that Evergrande would introduce the state-owned Guangzhou Urban Investment Group to restructure its debts, but it was not confirmed. The impact of other Chinese property stocks is also limited. On the contrary, if the Chinese property market stabilizes, it will have a positive impact on the index heavyweights such as Chinese banks and Chinese insurance companies. The scale of net foreign capital outflow/inflow.

In addition to the real estate stocks following the A-shares, the Hang Seng Index rose sharply yesterday mainly due to the sharp rise of leading stocks in the Internet of Things. Alibaba surged nearly 11% in a single day, which has contributed more than 160 points to the Hang Seng Index. Together with Tencent (0700), Meituan (3690) and others were all positive. The Hang Seng Index surged 667 points to 21,889 points throughout the day, but the main board turnover remained at 140.3 billion.

Many analysts pointed out that yesterday's sharp rise stemmed from Alibaba (9988) raising the repurchase amount from US$15 billion to US$25 billion, but the author has reservations about this. Before the market opened, it was reported that Alibaba (9988) only opened about 3% higher yesterday; secondly, according to the data released by the company, as of last Friday, it had only repurchased about 9.2 billion US dollars, which has not yet touched the original upper limit of 15 billion US dollars. ; Furthermore, Ali's announcement of the repurchase is only a positive factor for the company, and does not constitute an incentive for the overall science and technology sector to rise. It should be another piece of news that really led to the sharp rise in science and technology stocks yesterday:

"Foreign sources quoted sources as saying that the China Securities Regulatory Commission has asked some U.S.-listed companies, including Alibaba (09988), Baidu (09888) and JD.com (09618), to prepare to disclose more audit information. The source said, Chinese regulators are considering allowing U.S. regulators to examine audit working papers of Chinese companies that do not collect sensitive data. The CSRC convened earlier this month Internet giants including Baidu and JD.com to ask the companies, the sources added. Prepare audit documents for fiscal 2021 in the event of additional disclosure requirements from U.S. regulators. The sources also said the companies were told that if they were unsure about anything along the way, it was best to seek advice from Chinese regulators, including an audit and communication with U.S. regulators.”

As the proportion of Internet stocks in the Hang Seng Index is currently very high, the positive news of the Chinese concept stocks also has an important impact on the Hang Seng Index. Last night, the Chinese concept stocks continued to improve, and at the same time, it also led the Hong Kong stock market to return to the 22000 level (now rising). The level of about 200 to 22100). The author generally has a positive view on these giant companies in science and technology (otherwise, I would not have bought Tencent and Alibaba for long-term investment, and I did not sell it when the market fell earlier), But the short-term trend is too affected by news to grasp. The author is more concerned that the current news is mainly from the perspective of the Chinese side, but there is no response from the US regulatory side. If the US side is also willing to cooperate, I believe that Chinese stocks will still be very strong. Big upside.

Tencent will announce its results after the market closes today. The market generally expects that game revenue slowed down in the last quarter, and advertising revenue was not satisfactory. There is not much expectation for overall performance. Demolition), the prospects of the technology network industry and the company's corporate actions (such as whether there will be other similar actions after the assignment of JD.com) will have a greater impact. The influence of the post-market results meeting will be far greater than the performance of the performance, and it is worthy of everyone's attention.