The Zhitong Finance App learned that the three major indices of Hong Kong stocks were collectively under pressure and declined today. Among them, the Hengke Index showed the weakest performance. At one point, it fell 2% intraday. At the close, the Hang Seng Index fell 1.24% or 207.64 points to 16529.48 points, with a full day turnover of HK$90.689 billion; the Hang Seng State-owned Enterprises Index fell 1.16% to 5780.21 points; and the Hang Seng Technology Index fell 1.83% to 3528.47 points.
Zheshang International pointed out that from a fundamental perspective, the fundamental expectations of Hong Kong stocks have not improved, and strong policies are still the protagonists, focusing on whether the strength of subsequent policies can continue to exceed expectations; from a financial perspective, the US CPI and PPI data all exceed market expectations. While economic data is still strong, expectations of interest rate cuts are likely to be further adjusted.
Blue chip stock performance
Ideal Automobile-W (02015) led the blue chip decline. At the close, it fell 7.99% to HK$127.9, with a turnover of HK$2,466 billion, dragging down the Hang Seng Index by 24.06 points. According to Delayed Auto news, the ideal expected order for MEGA within 24 hours was about 3,000 units, but the final results fell short of expectations and only half of the target was achieved. Within half a month of its release, MEGA received orders for nearly 4,000 units. This month, the factory's MEGA production capacity was 5,000 units. Ideal Core Management is discussing whether it is necessary to lower the sales target to 50,000 to 60,000 units, but the final figure is yet to be determined.
In terms of other blue-chip stocks, Xinyi Solar (00968) rose 2.4% to HK$6.4, contributing 1.16 points to the Hang Seng Index; Li Ning (02331) rose 1.7% to HK$20.3, contributing 1.25 points to the Hang Seng Index; Yao Ming Kangde (02359) fell 7.49% to HK$39.55, dragging down the Hang Seng Index by 1.88 points; Oriental Overseas International (00316) fell 5.56% to HK$115.4, dragging down the Hang Seng Index by 1.4 points.
In terms of popular sectors
On the market, the performance of large technology stocks was generally sluggish, with Tencent, Alibaba, etc. all falling by more than 1%; CRO concept stocks led the decline throughout the day, with external disturbances continuing. The price war in the car market was intense, and automobile stocks fell high; real estate sales started in the first two months, and domestic housing stocks continued to decline; aviation stocks, semiconductor stocks, and Apple concept stocks declined one after another. On the other side, PV stocks reversed the market; international oil prices continued to rise, with three barrels of oil rising; expectations of contraction on the supply side of coal still exist, and most coal stocks rebounded.
1. PV stocks reversed the market and rose higher. At the close, Follett Glass (06865) rose 5.82% to HK$20.55; GCL Technology (03800) rose 5.07% to HK$1.45; and GCL New Energy (00451) rose 2.78% to HK$0.37.
The National Development and Reform Commission issued new regulations to promote the high-quality development of renewable energy. They were implemented on April 1, clarifying the scope of full guaranteed acquisitions and the responsibilities of all parties. The aim is to regulate electricity market behavior and ensure priority scheduling and full acquisition of renewable energy power generation projects. Debon Securities pointed out that the entities involved in full electricity purchases have changed, and the purchasers are gradually diversifying; the purchase price emphasizes market-based transactions, providing a policy basis for renewable energy to enter the market. It is expected that with the gradual implementation of the “Measures”, the consumption of green electricity will continue to be promoted and the consumption of new energy electricity will be increased, and green power operators are expected to benefit.
2. “Three barrels of oil” rose slightly. At the close, CNOOC (00883) rose 1.49% to HK$17.72; CNPC (00857) rose 1.11% to HK$6.4; and Sinopec (00386) rose 0.22% to HK$4.54.
Ukrainian media recently claimed that Ukrainian drones attacked three refineries in Russia's Samara region. The market feared that the Ukrainian attack would threaten Russian oil exports; in addition, “OPEC+” previously announced that it would extend the production reduction agreement until the end of June this year. International oil prices continued to rise on Monday. Brent crude oil futures rose 1.55 US dollars, or 1.8%, to close at 86.89 US dollars per barrel; WTI crude oil futures for April closed up 1.68 US dollars, up more than 2.07% to 82.72 US dollars/barrel. Everbright Securities pointed out that “three barrels of oil” are expected to achieve steady growth in performance and continued high dividends in the long run, thus bringing long-term stable returns through fluctuations in oil prices.
3. Coal stocks generally rebounded. At the close, Mongolian coking coal (00975) rose 7.1% to HK$8.3; South Gobi (01878) rose 6.53% to HK$4.08; and Yankuang Energy (01171) rose 1.94% to HK$17.84.
The National Bureau of Statistics recently announced the energy production situation for January-February 2024 and the production volume of industrial products above scale. Data show that from January to February 2024, China produced 710 million tons of raw coal, down 4.2% year on year; imported 74.52 million tons of coal, up 22.9% year on year. The cumulative coal supply was 780 million tons, down 1.9% year on year. Minsheng Securities believes that the decline in raw coal production in the first two months confirms the impact of safety supervision on production. In the later stages, along with the continuous strengthening of the safety supervision situation, it is expected that the growth rate of coal production may change from a slight increase to negative growth throughout the year. Capital Securities believes that medium- to long-term production capacity is lacking and supply flexibility is still lacking due to the depletion of resources in some mines. Demand is still expected to continue to reach new highs during the peak season, coal prices are unlikely to drop sharply, and the price of 5,500 kilocalories of coal in North Port is still expected to quickly rebound to more than 900 yuan/ton after the off-season ends.
4. CRO concept stocks led the market decline. At the close, Pharmaceuticals Kangde (02359) fell 7.49% to HK$39.55; Kingsley Biotech (01548) fell 7.05% to HK$15.56; and Kanglong Chemical (03759) fell 5.6% to HK$10.12.
Yao Ming Kangde announced its 2023 annual results, with revenue of 40,340.8 billion yuan (RMB, same below), up 2.5% year on year; profit attributable to parent company owners was 10.69 billion yuan, up 21.3% year on year. According to Yao Ming Kangde's annual report, the company expects revenue to reach RMB 38.3 billion to RMB 40.5 billion in 2024, and will maintain positive growth after excluding specific commercial production projects. It is worth noting that during the reporting period, Yao Ming Kangde's revenue from US and European customers increased by 42% and 12% respectively; the Chinese business only increased by 1%. As the US Biosafety Act continues to advance, there may be uncertainty about the company's 2024 performance.
Furthermore, according to a report by the Financial Association, in response to the previous voluntary application for termination of BIO membership, Yao Ming and Kangde responded that the company voluntarily sent a letter to withdraw from BIO on March 12 in order to allow BIO to focus more on effectively communicating with policy makers from an industry perspective, enhance understanding of the industry, and raise public awareness of the pharmaceutical industry. Yao Ming Kant also said that the “Biosafety Act” passed by the Senate Committee hearing on March 6 added grandfather clauses, which means that if it comes into effect according to this version, the company and the customer sign an extended or renewed contract involving funding from the US government or other commercial dealings with the US government will only be potentially restricted.
5. Domestic housing stocks continued to decline. At the close, Yuexiu Real Estate (00123) fell 6.64% to HK$4.5; Vanke Enterprise (02202) fell 5.63% to HK$5.36; and Jinhui Holdings (09993) fell 5.5% to HK$1.89.
The National Bureau of Statistics recently released national real estate development investment and sales data for January-February 2024. In January-February 2024, the national real estate development investment was 1184.2 billion yuan, down 9% year on year; in January-February, the new construction area was 94.29 million square meters, down 29.7% year on year; the January-February completed area was 105.39 million square meters, down 20.2% year on year; and January-February sales amount was 105.66 billion yuan, down 29.30% year on year. Galaxy Securities pointed out that sales, commencement, and completion of construction from January to February 2024 are all under pressure. Affected by factors such as low sales and extreme weather at the beginning of the year, the overall performance of the industry was poor. Around the Spring Festival, high-energy cities introduced demand-side relaxation policies one after another. The 5-year LPR was lowered beyond expectations, and urban real estate financing coordination mechanisms accurately supported real estate projects. The bank believes that the industry is expected to be positively affected.
Popular volatile stocks
1. The volume of Zhongan Group (00672) surged. By the close, it had risen 25.74% to HK$0.127.
Zhongan Group announced Yingxi. The Group expects to obtain a year-on-year increase in unaudited consolidated revenue of no less than 50% year-on-year; unaudited consolidated net profit of not less than 1000% year-on-year increase.
2. Special Step International (01368) strengthened after the results. At the close, it rose 9.03% to HK$4.95.
Teb International announced its 2023 annual results, with revenue of 14.346 billion yuan, up 10.9% year on year; net profit of 1.03 billion yuan, up 11.8% year on year, reaching a record high. The final interest rate was HK8 cents, compared to HK7.1 cents for the same period last year.
3. COFCO Jiajiakang (01610) rose significantly. At the close, it rose 5.7% to HK$1.67.
Since the Spring Festival, piglet prices have continued to rise, reflecting strong demand to fill the pig market. On March 18, 2405, the main contract for pigs in the domestic futures market, strengthened again, with a single-day increase of more than 3%, hitting a three-month high in the intraday period.
4. Reading Text Group (00772) was under pressure throughout the day. At the close, it fell 7.31% to HK$25.35.
According to Citi, due to the company's Shinih Media postponing the broadcast of some of the featured episodes, and the company's adjustment of online reading channels and investment in artificial intelligence during the period, the previous year's performance was mediocre, and revenue and adjusted profits were basically in line with the bank's and market expectations.