Intelligence Decision Reference | Jackson Hole Annual Meeting is Coming, Confidence in Hong Kong Stocks Needs to be Restored
Under the backdrop of the US stock market breaking through the support level, the Hong Kong stock market has experienced a rather poor performance. Last week, the Hang Seng Index hit a new low for the year, breaching the 18,000-point mark. The current situation facing the Hong Kong stock market is systemic in nature, making it difficult to withstand the bearish pressure on its own.
- [Editor-in-Chief Guan Shi] * * Hong Kong stocks are trending quite badly under the US stock market break. Last week, Hang Seng Index hit a low point in the year and declared its loss at 18000 points. At present, Hong Kong stocks are facing systemic problems, and it is difficult to withstand short pressure on their own. After the market last Friday, the China Securities Regulatory Commission announced that it answered reporters' questions on activating the capital market and boosting investor confidence, and proposed a series of specific measures to improve the market, but the overall lack of heavy benefits. Over the weekend, the People's Bank of China, the General Administration of Financial Supervision, and the China Securities Regulatory Commission jointly held a video conference on financial support for the real economy and prevention and resolution of financial risks. The main mention is: actively promote the transformation of urban villages, "flat urgent dual-use" public infrastructure construction. Adjust and optimize the real estate credit policy, coordinate the financial support of local debt risk resolution work. China's August one/five-year loan market quoted rate (LPR) will be announced on August 21. On August 15, the central bank cut the 1-year MLF and 7-day reverse repo operating rates by 15bp and 10bp, respectively. This month's LPR is expected to undergo an asymmetric downward revision, news that is expected to provide some stimulus to property. On the whole, market confidence has been greatly affected after the 18000 point breaks. What kind of feedback investors will give to the news this week is more critical. In addition, the annual Jackson Hole (Jackson Hole) Global Central Bank Annual Meeting will hit on August 24. The theme of this year's meeting is "Structural Transformation of the Global Economy". The market focused on watching the Fed Chairman Powell's speech, spying on what actions the Fed will take at its September policy meeting and its views on the inflation outlook. The movement of U.S. stocks will also have an impact on the Hang Seng Index. In terms of hot spots, from August 22 to 24, the 15th BRICS leaders' meeting will be held in Johannesburg, South Africa. BRICS expansion and monetary and financial cooperation will be the focus. * * The market is more concerned about whether the belt and road initiative will ferment. * * It is reported that the Yawan high-speed railway will be put into trial operation in early September. The construction of the Sino-Thai railway and the Sino-Lao-Thai railway connection line is also the direction that the market is more concerned about. Nvidia will announce its Q2 financial results for fiscal year 2024 (the three months ending July 31) after the U.S. stock market on August 24. Nvidia estimates Q2 revenue will exceed $11 billion, a year-on-year increase of "more than 50%". Minister of Industry and Information Technology Jin Zhuanglong: China's total scale of computing power is the second in the world, will increase the supply of high-performance intelligent computing. * * If it exceeds expectations, it will stimulate AI and computing power. * * * * [this week's gold stocks] * * * * Kingdee International (00268)* * in the first half of 2023, revenue 2.566 billion, up 16.8 percent year-on-year; losses 0.284 billion, compared with the same period last year to reduce losses by 73 million, down 20.8 percent year-on-year; operating cash flow 0.169 billion, down 10 million from the same period last year. R & D expenses increased 6.6 percent year-on-year, administrative expenses increased 2.1 percent year-on-year, and sales expenses increased 8.8 percent year-on-year, both significantly lower than revenue growth. Subscriptions are growing steadily, and renewal rates demonstrate product strength. ARR 2.54 billion, up 36.3 percent year-on-year. Sky ARR increased by 95.9 year-on-year, with a renewal rate of 108. Star ARR increased 28.6 percent year-on-year, with a renewal rate of 96%, and the profit margin of the enterprise version reached 28% +; The renewal rate of stars is 89%. Subscription contract liabilities increased 34.4 percent year-over-year. Based on the reusability of the pale bend focus on AI, vertical deepening of products. In the first half of the year, the launch of the Sky GPT, covering the Sky GPT-Finance (Guangdong Airport), the Sky GPT-HR (Hisense), the Sky GPT-development, accelerate the benchmark customer acquisition. According to the latest information from the Hong Kong Stock Exchange, on August 14, Xiaomo increased its holdings of 2.202465 million shares of Kingdee International (00268) at a price of HK $12.7724 per share, with a total amount of about HK $28.1308 million. The latest number of shares held after the increase is about 0.28 billion shares, and the latest shareholding ratio is 8.06 per cent. [Industry Watch] Recently, the Medical Insurance Bureau announced the drugs and related information that passed the preliminary form of examination through the adjustment of the national basic medical insurance, work injury insurance and maternity insurance drug catalogue in 2023. This time, 390 of the 570 drugs passed the preliminary examination. Compared with 2022 (344 of the 490 drugs passed), the number of drugs declared and passed the preliminary examination has increased to a certain extent. This time, 390 western and proprietary Chinese medicines passed the preliminary formal examination, with a passing rate of 68%, including 226 outside the catalogue, including 212 western medicines (171 exclusive varieties), 14 proprietary Chinese medicines (13 exclusive varieties) and 208 new generic drugs approved for listing in 2018-2023H1. There are 164 in the catalogue, including 136 western medicines (121 exclusive varieties) and 28 proprietary Chinese medicines (all exclusive varieties),2018-2023H1 approved 116 new generic drugs. The number of drugs for rare diseases, children's drugs and generic drugs that encourage research and development has increased year by year. The conditions for the application of drugs for rare diseases in the preliminary examination of the state talks again did not set the time limit of "approval for listing after January 1, 2017. In this preliminary review, 20 rare disease drugs (3 of which are children's drugs/generics) and 8 children's drugs/generics are encouraged. The number of ADC and CAR-T drugs through the first trial is the largest in the past years. The payment model of cutting-edge innovative drugs has always attracted much attention. In terms of ADC, in 2021, Rongchang Bio's Vidicetuzumab negotiations were successful, Takeda's Vidicetuzumab passed the preliminary examination but the negotiations failed, Roche's Enmetuzumab did not pass the preliminary examination; in 2022, Enmetuzumab successfully negotiated to become the first breast cancer ADC drug to be included in the health insurance list. In terms of CAR-T, in 2021, Fosun Kate's Akirensa injection passed the preliminary examination but was not successfully negotiated. In 2022, Yao Ming Junuo's reciolensai injection passed the preliminary examination but was not successfully negotiated. In 2023, 6 ADC and CAR-T drugs passed the first trial, the most in any calendar year. A number of important domestic innovative drugs through the first trial, worthy of attention. Dozens of newly approved innovative drugs outside the catalogue have passed the preliminary examination. Among them, domestic new drugs include befotinib of Beida Pharmaceutical Co., Ltd., oselidine fumarate injection of Enhua Pharmaceutical Co., Ltd., Ennadetostat tablets of Xinlitai Pharmaceutical Co., Ltd., Ebegerastatin α injection of Yifan Pharmaceutical Co., Ltd., regliptin phosphate tablets of Hengrui Pharmaceutical Co., Ltd., and linprisetosetex tablets of Linprietex tablets of Henrete. In the context of the gradual moderation of health insurance negotiation policy and the encouragement of innovation, the decline in access to health insurance for innovative drugs has narrowed, and innovative varieties with good efficacy and clinical scarcity will become more and more powerful in pricing, realizing price-for-volume exchange, which is good for the transformation of pharma and emerging biotech into the new drug harvest period. Hong Kong stocks focus on **Baiji Shenzhou (06160), Rongchang Bio (09995), Kangfang Bio (09926), Hutchison Pharmaceuticals (00013), Simcere Pharmaceuticals (02096), Junshi Bio (01877), Cinda Bio (01801), etc. **** [Data Watch] **According to data released by the Hong Kong Stock Exchange, the total number of open contracts in the Hang Seng Index (August) is 116404 and the net number of open positions is 45857. Hang Seng Period refers to the settlement date of August 30. Judging from the distribution of goods in Hang Seng Index Bull and Bear Street, at 17951 o'clock, the dense area of bull certificates is close to the central axis, and Hong Kong stocks have short-selling power. According to the research report of CICC, the valuation of A- share market is obviously low in major global markets, and the valuation of Hong Kong stocks is also in a medium low position, and the global investment performance ratio is relatively high. Zhu Chaoping, a global market strategist at JPMorgan Asset Management, said that from the valuation level, Hong Kong stocks are already at the bottom of the historical range, but lack a catalyst for the market. The near-term trend will depend more on the dynamics of domestic economic policy. Hang Seng Index is bearish this week.! Photo 1.png * * [Editor-in-Chief's Speech] * * This week is dominated by defense. Judging from some exchanges over the weekend, pessimism at the trading level has accelerated, and institutional defensive behavior may be shifting from "transferring positions" to "lowering positions". Undervaluation + high dividend + good cash flow stock selection strategies (concentrated in operators, petrochemicals, utilities and Chinese construction companies, etc.) will perform relatively well in this market. From another point of view, the market down is also an important opportunity for stock selection on the left. Some industries that may reverse in the second half of the year (e. g. consumer electronics, inventory bottomed out in the first half of the year, and a pick-up trend will be seen in the third quarter as consumption of functional terminals such as PCs and mobile phones stabilizes and stock up in peak season) can now begin to observe the appropriate buying points. **[Disclaimer] This VIP information product is for exchange and discussion only and does not constitute any investment advice. Reprinting without authorization is strictly prohibited. For more high-quality information and data products, please visit [Zhitong Finance] APP for inquiries. * *