• June 3, 2023

Android Circuit: Samsung’s Galaxy Success, Honor 90 Launch, Reddit’s Expensive Blunder

Taking a look back at seven days of news and headlines across the world of Android, this week’s Android Circuit includes Samsung grabbing a premium phone prize, leaked Pixel Watch 2 …

Apple Loop: Stunning iPhone 15 Pro Max Details, Apple Watch’s Secret Weapon, Powerful New Mac Leaks

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Are You Eligible For Ex-Spousal Social Security Benefits As A Divorced Spouse?

Spousal benefits are probably the most misunderstood Social Security benefit. Ex-spousal benefits may seem even more convoluted. To keep things simple, ex-spousal benefits are basically the same as current spousal benefits …

Key News

Asian equities were a sea of red following the US equity downdraft yesterday.

China and Hong Kong were hit with a round of good old fashion profit taking in advance of Friday’s Hong Kong market holiday. Yes, President Xi reiterated the success of the zero covid/lives first policy while visiting Wuhan. At the same time, early indications are that Chinese travelers are aggressively booking domestic and foreign travel following the easing of quarantine policies. According to a mainland article, “…the search volume for air tickets on the platform increased 60% within 30 minutes, the search volume for hotels doubled, and the search volume for trains increased by up to 1.5 times”. That’s the first half-hour!

A mainland media source noted that the Ministry of Industry and Information Technology (MIIT) removed the identification star of those who had traveled to cities with a covid outbreak on people’s phone-based itinerary card developed after the initial covid outbreak. If I went to a city with a covid outbreak, I might be forced to quarantine based on my phone’s itinerary card identifying me as a potential higher threat. No one is talking about this, but it is a big deal.

Mainland China and Hong Kong growth stocks such as lithium/solar/wind/auto/EV/EV battery-ecosystem/discretionary/healthcare, which have led the way higher since mid-March, were hit the hardest today. Nio HK (9866 HK) was off -11.36% following yesterday’s post-U.S. close fraud accusation from a firm I’ve never heard of. More interesting to me was a Chinese auto association that predicted June auto sales will be stronger than anticipated with EV sales anticipated to reach an all-time record of more than +500,000 sales.

Today was a flat-out off day as even tech plays couldn’t gain with President Xi’s speech. Real estate was the only positive sector after well-run property developer Vanke’s Chairman stated, “the market has bottomed out” though “the recovery is a slow and gentle process and will take time”. A well-run Chinese property developer? 100%! Check out Vanke’s bonds which trade at or near par value. Not all real estate developers are Evergrande. Could be an interesting time for washed out real estate bonds which hit an all-time low yesterday.

Remember tomorrow is the last day of the quarter, it is the last opportunity for active funds to increase their China weights before disclosing their holdings to investors.

Of the G-7 countries, how many have invaded China, held Chinese territory or had troops in China at some point over the last 150 years? The % might surprise you if you do some digging.

Two of the four Hong Kong ETFs approved for Southbound ETF Connect are based on the Hang Seng Tech Index. Interesting!

The Hang Seng and Hang Seng Tech were off -1.88% and -3.27% on volume +5.69% from yesterday which is 113% of the 1-year average. Only 90 stocks advanced while 395 declined. Hong Kong short sale turnover increased +5.5% from yesterday which is 133% of the 1-year average as short sale turnover accounted for 18% of Hong Kong turnover. Value factors outperformed growth factors as small caps outperformed large caps. Real estate was the only sector in the green gaining +0.7% while other sectors fell such as discretionary down -3.4%, tech -3.17%, and healthcare -2.96%. Top sub-sectors were travel related, online education, and real estate while internet, healthcare, auto, EV, and EV ecosystem were among the worst. Southbound Stock Connect volumes were moderate/high as mainland investors were net buyers of Hong Kong stocks with Tencent and Li Auto seeing healthy buying while Meituan and Kuaishou were small net sells.

Shanghai, Shenzhen and STAR
Board were off -1.4%, -2.2%, and -2.38% respectively on volume +7.67% from yesterday which is 121% of the 1-year average. 917 stocks advanced while 3,451 stocks declined. Value factors outperformed today growth factors while large caps outperformed small caps. Real estate was the only positive sector as discretionary was down -4.38%, materials -2.93%, and tech -2.43%. Real estate, urbanization, and cement subsectors outperformed while EV, lithium, auto, and rare earth underperformed. Northbound Stock Connect volumes were moderate/high as foreign investors sold -$251mm of mainland stocks. Treasury bonds rallied, CNY was off versus the US $ and copper off.


JD.com (JD US, 9618 HK) announced “renewed strategic cooperation with Tencent”. JD is giving Tencent $200mm shares in exchange for Tencent to “…continue to offer the Company prominent Level I and Level II access points on its Weixin platform to provide traffic support. The two parties also intend to continue to cooperate in a number of areas including communications, technology services, marketing and advertising, and membership services among others.”

Tianqi Lithium (002466 CH), a mainland heavyweight among domestic and foreign investors, is expected to go public tomorrow on the Hong Kong exchange. More details tomorrow!

Last Night’s Exchange Rates, Prices, & Yields

  • CNY/USD 6.69 versus 6.69 yesterday
  • CNY/EUR 7.05 versus 7.08 yesterday
  • Yield on 10-Year Government Bond 2.83% versus 2.84% yesterday
  • Yield on 10-Year China Development Bank Bond 3.05% versus 3.05% yesterday
  • Copper Price -0.17% overnight

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