Jinwu Financial News | US stocks performed well on Thursday. Employment data was weaker than expected, and expectations for interest rate cuts from the Federal Reserve heated up, which was beneficial to market performance. The three major indices all recorded increases and closed. The trend of the US dollar declined, interest rates on 10-year US bonds fell to 4.45 percent, and the performance of gold and oil prices improved. Hong Kong stocks have generally risen, and it is expected that the market will open higher in the early stages. The mainland stock market rose yesterday. The Shanghai Composite Index opened low and moved higher, closing up 0.8%. The turnover of the Shanghai and Shenzhen markets also increased slightly. Hong Kong stocks rose again after repeated consolidation, and market transactions remained active. The market atmosphere is improving. Thanks to rising expectations of interest rate cuts from the periphery, and policy news from the mainland, the index is expected to challenge the resistance of 18,800 points, and the downward support is around 18,200 points.
Industry news
Yum China (09987) previously announced net profit of US$287 million for the first quarter, a year-on-year decrease of 0.69%. Total revenue for the first quarter was US$2,958 million, up 1.4% year-on-year. Operating profit was $374 million, down 10.1%. The restaurant's profit margin was 17.6%, down 2.7 percentage points. Same-store sales fell 3% year over year. During the period, KFC's total revenue was US$2.23 billion, up 1.46% year-on-year, and same-store sales fell 2%; Pizza Hut's total revenue was US$595 million, down 0.34%, and same-store sales fell 5%. As of the end of March, the total number of Group stores reached 15,022, including 10,603 KFC stores and 3,425 Pizza Hut stores, with a net increase of 378 stores in the first quarter. The company's target for fiscal year 2024 remains unchanged, with a net increase of about 1,500 to 1,700 stores, capital expenditure of between US$700 and US$850 million, and a return of approximately US$1.5 billion to shareholders in the form of quarterly cash dividends and share repurchases. Yum's performance has been affected by macroeconomics in the short term. The company continues to invest capital expenditure to open new stores to seize future consumption upgrade opportunities in offline cities. Currently, it can continue to pay attention and wait for the macroeconomy to improve.
(The author is a licensee of the Securities Regulatory Commission. I and related parties do not hold the above shares)
Author: Guo Jiayao, Managing Director of Huiying International Asset Management