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Louise Moon

Gigi Choy

Deb Price

Hello traders --
We're off to another roller-coaster, volatile week that requires nerves of steel! Monday was down, Tuesday saw big gains.
Catch up on the day's action below.
And, hey, are you getting your Live Stocks Blog every morning via email? You can! Don't miss out on our coverage of Hong Kong and mainland markets each trading day! If you would like the Live Stocks Blog emailed to you each morning, click here.
-- Louise Moon, Gigi Choy and Deb Price 
 
Note: Information in this blog is on an "as is" basis and not a solicitation or offer to buy or sell any securities or otherwise; and is not investment/professional advice or services in this regard.  It is subject to our T&C.  SCMP (as defined in T&C) shall not be liable for any loss, damage and costs relating to any investments in securities or otherwise in this connection.


Why world’s economic powers could find 2025 a year of great struggle

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Chinese surveillance tech firm Dahua exits projects in Xinjiang

Stocks

Hong Kong, China stocks gain as US Congress appears near coronavirus stimulus deal

Hong Kong, known for its dazzling array of pubs, is banning alcohol sales at bars and restaurants to try to curb the spread of the coronavirus. Photo: Sam Tsang

Business

Overnight, US Fed announces fresh unlimited bond buying
World's largest economy nearing huge stimulus package for businesses, workers


Overnight, US Fed announced unlimited bond buying, among other steps. That sparked bargain buying of virus-hammered stocks in Hong Kong and elsewhere in Asia.  


China stock market

Hang Seng Index

Alibaba

Coronavirus pandemic: All stories

Live

Overnight markets/what futures foretell
- The S&P 500 shed 2.9 per cent, the Dow Jones fell 3 per cent and the Nasdaq dropped 0.27 per cent. Europe’s Stoxx 50 Index fell 2.47 per cent.
- Hong Kong futures were up 1.8 per cent, while the FTSE China A50 futures rose 3.1 per cent.
IPO debuts: None scheduled.
Economic statistics/central bank action: Hong Kong reports its fourth quarter industrial production, and PPI year-on-year figures at 4:30pm.
Corporate events, earnings, meetings, news conferences: Earnings in Hong Kong include Anta Sports (2020 HK), China Telecom (728 HK), Longfor Group (960 HK) and WH Group (288 HK). Earnings in the mainland include Beijing Kingsoft (688111 CH), Guotai Junan Securities (601211 CH), Henan Shuanghui (600183 CH), Shengyi Tech (600183 CH) and WuXi AppTec (603259 CH)


Morning guidance

China Feihe (6186 HK), maker of the nation’s best-selling infant milk formula, reported net profit was up 75.5 per cent to 3.9 billion yuan in the year of 2019.
The company’s gross profit was up 36.9 per cent to 9.6 billion yuan on a revenue of 13.72 billion, according to a company’s statement filed to the Hong Kong stock exchange late Monday. 
The company said it had more than 109,000 retail points of sale by the end of 2019.   
Feihe plans to pay a final dividend of HK$0.1943 per share. 
-- Pearl Liu   


China Feihe reports big jump in net profit

Japan’s service sector shrank by the fastest ever in March, while its factory activity fell at its quickest in a decade, amid the coronavirus outbreak that has hammered business and consumer activity.
The au Jibun Bank Flash Japan Manufacturing Purchasing Managers’ Index (PMI) fell to 44.8 in March, from 47.8 in February, to its lowest level since April 2009.
Total orders fell at their fastest pace since March 2009, due to a decline in domestic and overseas demand, while other indicators like employment and overall output also dropped. Meanwhile, the au Jibun Bank Flash Japan Services PMI index slumped to 32.7 in March, from 46.8 in February, hitting its lowest since the start of the survey in September 2007.
The Jibun Bank Flash Japan Composite PMI slumped to 35.8 in March, in its lowest since April 2011, and down from 47.0 in February.
The slowdown raises the risk of a downturn in the world’s third largest economy. Japan’s government is looking to offer cash payouts to households, as part of a US$276 billion package.“If the (virus) outbreak were to accelerate, the economic damage could far exceed what we’ve seen so far, particularly if the Olympic Games are postponed,” said Joe Hayes, economist at global informations provider IHS Markit, which compiles the survey, in a report by Reuters.
Japan’s economy is already under pressure, having shrunk by the most since 2014 in the final quarter of last year, hit by a sales tax hike.
-- Louise Moon


Japan’s service sector shrinks very quickly on coronavirus outbreak

SoftBank plans to sell about US$14 billion in shares of Chinese e-commerce giant Alibaba as part of an effort to raise US$41 billion to bolster its businesses battered by the coronavirus pandemic, according to Bloomberg.
The Japanese tech conglomerate is the largest shareholder of Alibaba, the owner of the South China Morning Post. The sale could range from US$12 billion to as much as US$15 million, Bloomberg said.
SoftBank is considering raising the rest of the money by selling a stake in SoftBank Mobile, its domestic telecommunications arm, as well as a stake in US mobile carrier Sprint Corp., which merged with rival T-Mobile, to reduce debt and restore investor confidence.
Part of the asset-sale proceeds will help pay for a buyback of as much as 2 trillion yen (US$18 billion).   
-- Gigi Choy


SoftBank plans to sell Alibaba shares to boost investor confidence and fund buyback

Fidelity: Fed plays the “ultimate card” to help markets, but more fiscal stimulus needed
The Fed has played the “ultimate card” in its battle to keep markets afloat, according to Anna Stupnytska, global head of macro and investment strategy at investment management services company Fidelity International, in reference to the central bank offering to directly finance US companies to shelter the economy.
“The Fed has thrown another lifeline to markets and the economy as the Covid-related disruption continues to ripple through the system. As its earlier interventions failed to abate severe stresses that have emerged in both US treasury and mortgage-backed security markets, the Fed has now pulled out the ultimate card – QE infinity – committing to unlimited purchases of government bonds and MBS,” wrote Stupnytska in a morning note.
Though it is encouraging to see the Fed stepping in further, “all these efforts have to be matched by much bigger and timely packages on the fiscal side, which in turn have to be effective in helping the economy in this downturn but also – importantly – in the recovery,” she said.
Stupnytska thinks a V-shaped recovery in the second half of the year is unlikely, given the uncertainty of the situation, and “radical policy interventions” are needed in the next few weeks for the US economy to emerge unscathed.
-- Louise Moon 


US Fed throws in ‘QE infinity,’ says Fidelity

Hong Kong’s Hang Seng rose at the opening bell, by 3.2 per cent to 22,390.03.
  On the mainland, the Shanghai Composite gained 1.6 per cent to 2,703.30, while the CSI 300 rose 1.9 per cent to 3,597.06.
-- Gigi Choy


Hang Seng opens higher; so does Shanghai

Seoul’s Kospi rose 5.3 per cent, and the tech-heavy Kosdaq went up 5.5 per cent.
Tokyo’s Nikkei 225 is 4.8 per cent higher.
Japan’s services sector shrank at the fastest pace on record in March and its factory activity at its quickest in about a decade, Reuters reported of a new business survey in the world’s third largest economy. Japan is under increasing pressure to postpone the Olympics Games, with Canada and Australia saying they will not send their athletes due to dangers posed by the virus.
Australia’s S&P/ASX200 rose 3.3 per cent. It plummeted 5.6 per cent on Monday. New Zealand's S&P/NZX50 went up 4.6 per cent, after its 7.6 per cent decline at the start of the week.
Meanwhile, Singapore’s Straits Times Index rose 3.6 per cent after plunging 7.3 per cent on Monday.
-- Gigi Choy


Asia-Pacific markets soar

Henderson Land Development (12 HK), the third largest developer in Hong Kong, reported a 26 per cent drop of core profit to HK$14.6 billion.
Including the fair value change of investment properties and investment properties under development, the company's net profit for the year plunged 45 per cent to HK$14.16 billion on revenue of HK$24.2 billion in 2019.  
“Hong Kong’s economic outlook is still hindered by unfavourable factors, including those stemming from the protracted local social unrest and spread of the novel coronavirus infection … It is expected that the operating environment for the group’s various businesses will be challenging this year,” said the company in its annual results statement filed to the Hong Kong stock exchange late on Monday. 
Henderson Land plans to pay a final dividend of HK$1.3 per share on June 26, bringing the full-year dividend to HK$1.8 per share, on par with that in 2018.
Henderson’s shares fell 4.2 per cent to HK$27.15 in a rallying market.
-- Pearl Liu


Henderson Land falls after drop in core profit

Tencent (700 HK) is up 4.8 per cent in morning trading to HK$364.60, as the stock bounces back from wider market losses.
The stock shed 17 per cent from March 5 to 18, along with wider stock market losses, bringing it to HK$334 which it had previously hit in December 2019. In that time, its 14-day relative strength index (RSI) shifted from 56 to 29: a reading under 30 indicates a stock is oversold.
  But in the past week Hang Seng Index heavyweight Tencent has rebounded 9 per cent to this morning’s HK$364. Its 14-day RSI is now 39.
The online gaming and social media giant rolled out a new health tracking app Monday named Fuxuema for Chinese students preparing to return to school after the outbreak. The app, embedded in WeChat, allows students to fill out daily temperatures and get a colour-based QR code to show their health status.
Meanwhile, in a note on Monday, credit rating agency Moody’s Investors Service said Tencent’s full year 2019 results, announced last week, were slightly ahead of its expectations, and supported the company’s A1 issuer and senior unsecured ratings.
  “We expect that Tencent will continue to benefit from revenue diversification and generate positive free cash flow to support its investment needs over the next 12-18 months while maintaining a prudent financial discipline and credit profile that’s commensurate with its A1 ratings,” it said.
Meanwhile, competitor Alibaba (9988 HK) is up 1.6 per cent in trading to HK$172.70. It too has fallen through March to an all-time low of HK$170 on Monday.
-- Louise Moon


Tencent and Alibaba rebounding

Investment holding company Zhongchang International Holdings (859 HK) – which primarily deals in real estate – has halted trading on the Hong Kong stock exchange “pending the release of an announcement in relation to inside information of the company” relating to takeovers and mergers, it said in a filing this morning.
-- Louise Moon


Zhongchang International halts trading on takeover and merger news

“The Fed’s latest round of stimulus is a game changer,” said Edward Moya, senior market analyst at OANDA.
  “The Fed launched unlimited QE, corporate bond intervention, enhancements to the commercial paper funding facility and telegraphed a main street lending program to small businesses.  The Fed has delivered three huge acts in March and this latest one should satisfy everyone, including President Trump,” he wrote in a fresh note. 
In quantitative easing, a central bank buys longer-term government securities and others to boost money supply and spark lending and investment.
-- Deb Price   


Fed’s steps a ‘game changer,’ says analyst Edward Moya

Investment holding company Beijing Gas Blue Sky Holdings (6828 HK) – which predominantly sells natural gas and other products – issued a profit warning to the Hong Kong stock exchange, saying it expects a decrease in net profit for 2019, compared to the previous year.
“Such decrease was mainly due to the non-recurring gain arising from acquisition of an associate recorded in profit or loss for the year ended 31 December 2018,” it wrote, without further information.
It fell 1.8 per cent to HK$0.165.
-- Louise Moon


Profit warning from Beijing Gas Blue Sky Holdings

The UK has banned all unnecessary movement of people for at least three weeks.
All but essential shops were ordered to shut immediately. Those who do not follow the rules risk being fined.
Meanwhile, Washington Governor Jay Inslee announced a statewide stay-at-home order on Monday, which will remain in place through April 6. The US state ordered all non-essential businesses to close. The governors of 15 of the 50 US states have issued stay-at-home orders and have shut down all but essential businesses.
-- Gigi Choy


UK, Washington state in US latest to lock down

Hang Seng up 3.8 per cent; Shanghai up 1.4 per cent

Banks climbed along with wider gains on the Hang Seng in morning trading.
Mainland banks have lowered rates and boosted the amounts they will lend to consumers, as Beijing tried to help boost domestic consumption amid the coronavirus.
More than a dozen state-owned lenders have started offering promotions, like halving borrowing costs and doubling the amount consumers are allowed to borrow, since the banking regulator relaxed credit controls in February, according to a report by the Financial Times on Monday.
  Hong Kong-listed mainland banks rose across the board, led by Bank of China (3988 HK) with a 4 per cent gain, China Construction Bank (939 HK) with a 4 per cent gain and China Merchants Bank (3968 HK) with a 3.8 per cent gain.
-- Louise Moon


China banks gain in Hong Kong

Major US airlines are preparing for a potential voluntary shutdown of virtually all passenger flights across the country, according to the Wall Street Journal.
  Travel restrictions and stay-at-home orders to contain the coronavirus pandemic are deepening the crisis for the airline industry.
US airlines have already cut the vast majority of international routes and have announced plans to slash domestic flying by as much as 40 per cent.   
-- Gigi Choy


US airlines drafting plans to ground domestic flights

The US Fed’s step to unlimited bond buying will help the world, and is sparking the big rally in Asia-Pacific, said Alan Li, portfolio manager at Atta Capital. Markets also expect the massive stimulus bill will eventually be agreed on and passed by the US Congress, which will help the world’s largest economy.
“For the economic relief package, only the US benefits from it. However, an unlimited QE, all over the world gets a free ride from it, especially asset value and yield plays,” he said.
Under quantitative easing (QE) monetary policy, a central bank buys longer-term government securities and others to boost money supply and spark lending and investment.
-- Deb Price 


Markets rallying on ‘free ride’ from US Fed move, says analyst Alan Li

Airlines are rising, following the trend of the Hang Seng, despite countries around the world bringing airline travel to a halt.
On Monday Hong Kong said it would ban all tourist arrivals.
Air China (753 HK) was up 2 per cent to HK$4.90, recovering from a 52-week low on Monday when it hit HK$4.82 in intra-day trading along with wider market losses.
Its stock in Shanghai (601111 CH) was up 2 per cent to 6.48 yuan.
Other airlines were also positive, with China Eastern Airlines (670 HK) (600115 CH) gaining 4.5 per cent to HK$2.57, and 1.24 per cent to 4.08 yuan in Shanghai.
China Southern Air (1055 HK) (600029 CH) shooting up 6.2 per cent to HK$3.08, and 0.78 per cent to 5.18 yuan.
Meanwhile Hong Kong’s flag carrier Cathay Pacific Airways (293 HK) rose 3.4 per cent to HK$7.92.
On Monday, Hong Kong’s government announced a HK$1 billion package of relief measures for the aviation industry, including a government waiver of HK$670 million for air traffic control charges in 2019-20, and a HK$330 million in contributions.
The package is expected to benefit more than 400 companies, including airlines, airport retail tenants and restaurants, as well as airport staff.
Here’s what analysts say about what’s ahead for virus-hammered China airlines. 
-- Louise Moon


Airlines rising, despite global travel restrictions

Forecasts of doom for the American economy are quickly turning from grey to pitch black.
As Congress haggles over a multitrillion-dollar coronavirus rescue package, analysts are warning the US could be facing a prolonged depression rather than the kind of short recession and swift bounce back that President Donald Trump and his top aides expect. And they’re raising questions about whether current government efforts to cushion the economy from the damage will be anywhere near enough.
Across Wall Street and the economic world, forecasters are quickly ramping up their predictions of massive job losses and declines in economic activity by as much as an annualised 50 per cent in the second quarter of the year. They’re offering estimates unseen since the Great Depression that began in 1929 and continued for a brutal decade, reshaping governments and economies across the globe.
Morgan Stanley economists on Monday said they now expect a 30.1 per cent annualised decline in gross domestic product in the second quarter, the worst quarterly performance in 74 years. The firm’s estimates assume the virus peaks in April and May before growth starts to recover. But if the peak comes later and economic disruption continues in the second half of the year, they wrote, US growth for even the entire year will be down to levels last seen in the early 1930s.
The rescue package now being debated in Washington would involve at least US$1.6 trillion of government spending, representing just a few weeks of lost economic activity. But the hit will almost certainly be vastly larger than that, analysts say, requiring multiple congressional interventions in order to come close to offsetting the fastest economic shutdown in American history.
The coronavirus crisis essentially knocked out the strongest pillars of the US economy: consumer confidence and spending. It has also driven a once high-flying stock market into bear market territory, making Americans feel less wealthy and less apt to spend.
Read full story here. 


Great Depression 2?

Seoul’s Kospi rose 5.9 per cent, and the tech-heavy Kosdaq jumped 5.4 per cent.
  Tokyo’s Nikkei 225 shot up 6.7 per cent.
Japan’s services sector shrank at the fastest pace on record in March and its factory activity at its quickest in about a decade, according to a new business survey in the country reported on by Reuters. The world’s third largest economy is under increasing pressuring to postpone the Olympic Games, with Canada and Australia saying they will not send their athletes due to dangers posed by the virus.
Australia’s S&P/ASX200 rose 2.1 per cent. It plummeted 5.6 per cent on Monday. New Zealand’s S&P/NZX50 shot up 6.5 per cent, after its 7.6 per cent decline at the start of the week.
Meanwhile, Singapore’s Straits Times Index rose 3 per cent after plunging 7.3 per cent on Monday.
-- Gigi Choy


Asia markets continue rallying

More intervention by the US Fed is likely to come, according to investment management company Invesco.
“While Fed measures in the government markets are open-ended, in private sector markets, new loans are limited to US$300 billion, with the Treasury to cover up to US$30 billion in losses. But it is highly likely that there is more to come,” Invesco’s fixed income team wrote in a note.
The current draft of the Senate bill proposes to allocate US$425 billion to the Treasury’s Exchange Stabilisation Fund (ESF), which the Fed could use to significantly expand its current credit support programs, it said.
“We believe the Fed’s proactive and aggressive policies are limiting risks to the financial system and providing fertile ground for an economic recovery after the peak in the Covid-19 shock,” it said.
-- Louise Moon


Invesco: more intervention to come

How long until this mother of all grizzly bears goes into hibernation? Traders and analysts weigh in.
Global markets are unbelievably volatile. Get used to it, analysts say. 
Tencent (700 HK) has a big fan club. Here’s why. 
China airline stocks will come back. What should investors know?
And Macau casino stocks have been beaten down. What do analysts say about their odds ahead?


ICYMI: Features for investors on this big grizzly bear, Tencent, China airlines, casinos

South Korean President Moon Jae-in said his government will double a planned market rescue package to help contain the economic and financial fallout from the coronavirus outbreak.
The package will now be 100 trillion won (US$80 billion).
The government will expand policy financing loans for small-to-medium companies, help them keep jobs and inject liquidity into financial marketing by buying corporate bonds, according to a report by Reuters.
Seoul’s Kospi was up 6.29 per cent to 1,576.51 in morning trading, marking a sharp turnaround from a drop of 5.3 per cent on Monday. The tech-heavy Kosdaq also rose, by 5.85 per cent to 496.74, having fallen by 5.1 per cent on Monday.
-- Louise Moon
 


South Korean government boosts market sentiment with stimulus

Beijing Aeonmed Co. is one of many companies working around the clock to make lifesaving ventilators that can help a Covid-19 patient breathe.
“There’s literally no country in the world that doesn’t want to buy a ventilator from China right now.” Li Kai, director of Beijing Aeonmed told Bloomberg.
“We have tens of thousands of orders waiting. The issue is how fast we can make them.”
Ventilators, which cost tens of thousands of dollars, are mechanical breathing devices that pump oxygen into the lungs and remove carbon dioxide from the body. They are crucial for many patients because their blood oxygen level drops precipitously -- a condition called hypoxemia -- which can cause organ damage.
The global ventilator market is worth more than US$1 billion annually, according to Swiss-based Hamilton Medical.
On Monday, US-based ResMed (NYSE: RMD) rose 6.1 per cent to US$121.36. Germany's Dragerwerk AG (ETR: DRW3) jumped 13.8 per cent to 75.20 euros, while Getinge AB (STO: GETI-B) of Sweden fell 1.8 per cent to 171.60 Swedish krona.
-- Gigi Choy 


Demand for lifesaving ventilators soars

The Hang Seng Index contained its gains through morning trading, closing for midday up 3.6 per cent to 22,468.79.
On the mainland, the Shanghai Composite also ended up, by 1.5 per cent to 2,699.43, while the CSI 300 of large caps rose 1.85 per cent to 3,595.54.
-- Louise Moon


Hang Seng to start after up 3.6 per cent; Shanghai is up 1.5 per cent

New economy stocks are soaring.
Meituan Dianping (3690 HK) shot up 6.6 per cent to HK$86.15, while Ping An Good Doctor (1833 HK) advanced 4.8 per cent and Meitu (1357 HK) which makes a popular photo-retouching app, shot up 3.6 per cent to HK$1.46.
Ali Health (241 HK), Alibaba’s health care platform, gained 4.1 per cent to HK$11.58.
  The Hang Seng is ahead 3.7 per cent at 22,500.56.
--  Deb Price   


New economy stocks mostly outperforming market

Anta reported 2019 results, with second half of 2019 sales ahead of Jefferies' forecast while earnings were in line.
The sales beat was driven mainly by Fila. Its revenue was 15 per cent higher than the investment bank's forecast for 2H19. Anta acquired the rights to the brand in China, Hong Kong and Macau in 2009.
But Anta unit JVCo's loss reached 1 billion yuan, which was higher than Jefferies' expected loss of 800 million yuan.
Jefferies gave Anta a “buy” rating at a target price of HK$86.00.
Anta Sports (2020 HK) rose 5.6 per cent in a rising market to HK$52.30.   
-- Gigi Choy


Anta sales results beat Jefferies’ expectations

The coronavirus outbreak has impacted the business development and network construction of China Telecom (728 HK) so far this year, according to the company in its earnings announcement to the stock exchange.
It added it was the first company to complete 5G network deployment for the Wuhan Huoshenshan Hospital – the emergency hospital in Wuhan created to deal with the crisis – and other locations.
In the filing, China Telecom reported a 3.3 per cent decrease in net profit for 2019, to 20.5 billion yuan, while operating revenues also decreased, by 0.4 per cent to 374 billion yuan. Service revenue was up 2 per cent, to 357 billion yuan.
Some areas of business, including wireline broadband and voice services, saw declines in revenue due to increased competition. Mobile terminal sales also declined. Many others, including internet services, telecommunications network resource and equipment services and information and application services, increased in revenue.
“China Telecom capitalised firmly on the invaluable opportunities arising from the digital transformation of the economy and society, as well as 5G commercialisation,” it said in the filing.
By the end of 2019, the company had invested 9.3 billion yuan to build 40,000 5G base stations, and co-shared more than 20,000 of China Unicom’s 5G base stations.
Its total number of mobile phone subscribers were 336 million, with 4G subscribers accounting for 84 per cent of those. The total number of wireline broadband subscribers reached 153 million.
The company said it aims to develop more Big Data capabilities, accelerate its 5G network construction and push forward reforms for R&D systems to accelerate breakthroughs in key technology areas.
The stock traded up 8.1 per cent in afternoon trading, to HK$2.27.
-- Louise Moon


China Telecom hit by coronavirus, slight decrease in 2019 earnings

Genting Hong Kong (678 HK) said it will temporarily suspend operations in all three of its shipyards in Germany for four weeks, in line with most of the major manufacturing and shipbuilding companies in Europe.
  “The operation of certain cruise ships of the Group have also been temporarily suspended in response to the unpredictable circumstances evolving from the global outbreak of Covid-19,” it said in a filing to the Hong Kong stock exchange.
It is trading ahead 1.5 per cent at HK$0.35.
-- Louise Moon


Genting suspends operations in Germany

At lunchtime, Longfor (960 HK) reported that FY19 core profits were up 21 per cent year-on-year to 15.6 billion yuan, in line with Jefferies' forecast.
The investment group noted the company's solid growth in its investment properties, with total rental income up 42 per cent year-on-year and average occupancy further increasing to 98.5 per cent for malls.
  Longfor is hosting an earnings briefing at 3.30pm Hong Kong Time.
You can listen in by clicking here https://www.roadshowchina.cn/Meet/detail.html?mid=7762 for the webcast, or dial in with the following numbers: HK: +852 3018 6949 or + 852 3018 3032, China: 023-6362-3333 or 4008-063-263, and Overseas: (86) 23-6273 7100. The passcode is: 749134403#. Pre-registration is required.
Longfor Group is up 7.2 per cent to HK$33.35.   
-- Gigi Choy


Longfor FY19 results in line with expectations, Jefferies says

Chinese pig producer COFCO Meat Holdings (1610 HK) – a subsidiary of state-owned conglomerate COFCO, with investments spanning from grains to property – rose 6.8 per cent to HK$1.89 after posting strong earnings and predicting hog prices will remain high through 2020.
The company’s revenue for 2019 rose 54.5 per cent to 11 billion yuan, though net profit declined 270 per cent to 425 million yuan.  A tightened domestic supply of hogs caused by the coronavirus outbreak will continue in 2020, it said.
The average selling price of finished hogs jumped 39.8 per cent to 16.16 yuan per kilogram through 2019, while production volume shed 22.2 per cent to total 1.9 million pigs.
Meanwhile the volume of fresh pork sales was down 23.3 per cent to 146,000 tons. The sales volume of imported meat rose 93.3 per cent to 179,000 tons.
African swine fever has slammed production and hiked up prices of hogs in China since August 2018. Domestic production volume shed 21.6 per cent through 2019, and pork output slammed 21.3 per cent.
The supply gap drove prices up to reach 41 yuan per kilogram last November, according to COFCO Meat Holdings.
As capacity was resuming – boosted by measures by the government to promote production – the outbreak of coronavirus hit, according to the company.
It said that “tightened domestic supply of hogs will persist in 2020, which in turn will support hog prices for the whole year”.
-- Louise Moon


Coronavirus to keeps hog prices high through 2020, says COFCO

Seoul’s Kospi rose 8.6 per cent, and the tech-heavy Kosdaq jumped 8.3 per cent.
South Korean President Moon Jae-in said his government will double a planned market rescue package to help contain the economic and financial fallout from the coronavirus outbreak. The package will now be 100 trillion won (US$80 billion).
Tokyo’s Nikkei 225 shot up 7.1 per cent.
Japan’s services sector shrank at the fastest pace on record in March and its factory activity at its quickest in about a decade, according to a new business survey in the country reported on by Reuters. The world’s third largest economy is under increasing pressuring to postpone the Olympic Games, with Canada and Australia saying they will not send their athletes due to dangers posed by the virus.
Australia’s S&P/ASX200 rose 4.2 per cent. It plummeted 5.6 per cent on Monday. New Zealand’s S&P/NZX50 shot up 7.2 per cent, after its 7.6 per cent decline at the start of the week.
Meanwhile, Singapore’s Straits Times Index rose 4 per cent after plunging 7.3 per cent on Monday.   
-- Gigi Choy


Asia-Pacific markets continue to rise

The Shanghai Composite closed up 2.34 per cent to 2,722.44, reversing Monday's loss of 3.1 per cent loss.
The CSI 300 of large caps gained 2.68 per cent to end at 3,625.12.
Leading the gains were gold-related stocks, automobiles and domestic consumption.
Among gold, Shandong Gold Mining (600547 CH) gained the daily limit of 10 per cent, to 33 yuan, while Zijin Mining (601899 CH) gained 8.09 per cent to 3.74 yuan.
Among car manufacturers, Great Wall Motor (601633 CH) boosted the 10 per cent daily cap, to 8.58 yuan, and BAIC BluePark New Energy Technology (600733 CH) rose 9.94 per cent to 5.31 yuan.
And among food and beverage companies, Tsingtao Brewer (600600 CH) rose 9.99 per cent to 43.27 yuan, and the world’s largest liquor maker Kweichow Moutai (600519 CH) gained 3.63 per cent to 1,056 yuan.
-- Louise Moon


China closes with gains; Kweichow Moutai rises

JPMorgan Pacific Securities Fund (JFPACSI HK), which invests primarily in the securities of Asia-Pacific companies, took the crown for Best Asia-Pacific Equity Fund.
Fidelity Global Focus Fund (FIDGFAU LX), which primarily invests in stocks across the world’s stock markets, was named Best Global Equity Fund.
UBS (Lux) Equity Fund -- China Opportunity (SBCEHKI LX) came out on top for Best Greater China Equity Fund.
First State Hong Kong Growth Fund - Class I (CMGHKII ID), which invests primarily in securities listed on Hong Kong's stock exchange or securities issued by such companies, took the prize for Best Hong Kong Equity Fund.
Legg Mason Western Asset Asian Opportunities Fund (LMWOADU ID), which invests at least 70 per cent of its net asset value in debt securities issued by Asian issuers and in derivatives on Asian interest rates and currencies, won Best Asia Bond Fund.
Neuberger Berman and Capital Group were named Best Equity Fund House and Best Fixed Income Fund House, respectively.
Meanwhile, Fidelity Retirement Master Trust was awarded Best Mandatory Provident Fund (MPF) Scheme. MPF is a compulsory pension fund designed by the Hong Kong government.
-- Gigi Choy


2020 Morningstar Fund Awards Hong Kong winners announced

Gains in Hong Kong and Asia markets are temporary, according to Louis Tse, managing director of VC Asset Management.
"This is a not an uptrend yet. We're nowhere near any turnaround because the virus is still around," he said.
"We're not out of the woods yet. We're right in the middle," Tse said.
Whether stimulus injections from central banks worldwide will help stabilise the market is still in question, he said.
"I doubt the rebound will be more than two or three days because it's the end of the first quarter. The market has been so down heavily, especially in March." he said. "It's time for those in short positions to sort of tidy up a bit, just in case. This is more or less like early ‘window dressing’ ... it's about position squaring ahead of the quarter ending, taking a bit of profit for those short-sellers during this month."
-- Gigi Choy


No bottom yet, says analyst Louis Tse

“Investors in Asia are focusing on the latest QE [quantitative easing by the US Fed] move. They believe Asia stocks will benefit from improving liquidity,” said Kenny Wen, wealth management strategist at Everbright Sun Hung Kai.
 He said traders today were bottom fishing virus-battered stocks, leading to the big gains seen throughout the Asia-Pacific region.
  “I think today’s rally in Asia is short-lived,” Wen said.
-- Deb Price 


Rally in Asia won’t last, says analyst Kenny Wen

Gold-related stocks rallied in Hong Kong and China, alongside wider market gains, as investors piled back into the safe haven stock after it plummeted in recent weeks.
Spot gold was 1.27 per cent higher at US$1,572.89 per ounce, by 4pm Hong Kong time.
It has risen 3.6 per cent so far this year.
Among related stocks in Hong Kong, Zhaojin Mining (1818 HK) flew up 16.97 per cent to HK$7.65, while Shandong Gold Group (1787 HK) added 12.88 per cent to HK$17.88, China Gold International Resources (2099 HK) jumped 10.66 per cent to HK$4.05, and Zijin Mining Group (2899 HK) gained 9.41 per cent to HK$2.79.
On the mainland, Shandong Gold Group (600547 CH) jumped by the daily limit of 10 per cent, to 33 yuan, Zijin Mining (601899 CH) rose 8.9 per cent to 3.74 yuan, and Zhongjin Gold (600489 CH) added 8.66 per cent to 8.16 yuan.
Goldman reaffirmed its 12-month target for bullion to advance to $1,800 an ounce, Bloomberg reported, where it hasn’t traded since 2011 when it was at an all-time high.
-- Louise Moon


Gold rallies as investors pile back in

K Wah International (173 HK), chaired by billionaire Lui Che-woo, reported a per cent increase of core profit in 2019, much lower than 19 per cent in 2018.
The Hong Kong home builder said its underlying profit for the year of 2019 was HK$ 3.15 billion on a revenue of HK$ 10.65 billion, in a final result announcement filed today.
The company said that the impact of the coronavirus on the world economy has not yet fully been reflected and uncertainties are ahead.
  “Global financial markets are recently very volatile. Implementation of phase one of the trade agreement between mainland China and the US, and pending negotiation on its phase two also cast uncertainty and volatility on the economic growth of Hong Kong and mainland China, and also globally in 2020,” the company said in the statement.
  “Despite this challenging business environment, the Group remains cautiously optimistic about the Hong Kong and mainland China property market demand,” the company added.
  K Wah is going to deliver a final dividend of HK$ 0.14, bringing the total dividend to HK$ 0.2, on par with that in 2018.
  K Wah’s shares closed at HK$3.15, up 7.5 per cent after the results were announced.
-- Pearl Liu 


K Wah reported slower increase in core profit

The Hang Seng Index rose 4.5 per cent to 22,663.49, following Monday’s loss.
Some of the top winners were ZTE (763 HK), which shot up 10.7 per cent to HK$22.8, China Unicom (762 HK), which gained 10.3 per cent to HK$4.5, and Geely Automobile (175 HK) which rose 10.7 per cent to HK$11.16.
-- Louise Moon


Hang Seng runs up gains of 4.5 per cent

European stocks rose in early morning trading, following Asia Pacific markets' rise.
The German DAX was up 4.7 per cent, the Euro Stoxx 50 gained 4 per cent, Italy's FTSE MIB added 5.3 per cent and Britain's FTSE 100 was up 3.8 per cent.
-- Louise Moon


Hong Kong, China stocks gain as US Congress appears near coronavirus stimulus deal

Overnight, US Fed announces fresh unlimited bond buying World's largest economy nearing huge stimulus package for businesses, workers

Overnight, US Fed announces fresh unlimited bond buying

World's largest economy nearing huge stimulus package for businesses, workers