Waiting for the frying edge
In the new mainland, the PMI data in October was stable. Hong Kong stocks continued to rise. The Hang Seng Index closed at 25,416 points, up 436 points or 1.75%. The H-Share Index closed at 10,279 points, up 140 points or 1.39%. In October, Hong Kong stocks were not good, and at the same time, they accumulated considerable short-selling positions. The bleak targets yesterday were mostly concentrated on the weak sectors; domestic housing, mobile phone equipment and Chinese brokerage stocks, and even Macao announced that October gaming revenue increased by 2.6% year-on-year. The gambling stocks also have a short-selling rebound. Tencent (00700), which has dragged down the market in recent months, also rose 4%. It does not rule out a technical rebound in short-term rotations. The next week before the US Congress’s midterm election results, it is not appropriate. Do a short position and wait for the “D-Day” hype to come.
The author believes that the Chinese and Hong Kong stock markets are in a speculative period with only speculative value. During the year, the HSI has repeatedly commented on the mid-line technical indicators of the true death cross, and the 10-year cycle of economics. The Sino-US economic and trade game is a catalyst for the turn of the ups and downs. However, in October, the Hang Seng Index accumulated nearly 3,000 points of decline, surpassing the author’s expectations. It also caused the early deployment of 25,000 to 26,000 points. The absorption strategy was once invalid. Fortunately, the 24,500-point stop loss was not implemented. For the above calculation, temporarily take the 26000 to 26500 points as the retreat level.
The inner room rebounded. Rundilong Lake rose by half.
However, the Hang Seng Index recently rebounded from the low level by nearly 900 points, which reflects that the market conditions are affected by the external political and economic variables. It is expected that the chances of rising and falling this month will not be low. The results of the mid-term elections in the US Congress next week will affect the short-term market sentiment.
Recently, friends have oversold the market, and the mainland announced the latest PMI data. The central government confirmed that the economy is under downward pressure. The market expects more loose and targeted stimulus policies. On the other hand, the White House seems to release the negotiation space between China and the United States. The message, with the results of the mid-term election next week, induced the friend to close the position and make a profit. Although the Democratic Party has regained a large chance of a majority of seats in the Senate and has not changed the US hostile policy toward China, it will at least hinder US President Trump from exercising orders. More importantly, the election results will indicate Trang. After two years of re-election, the re-election will hinder the future. The Sino-US talks are expected to achieve short-term and compromised results, and China’s future reorganization of the pace of reform and opening up will benefit the Chinese and Hong Kong stock markets. Of course, the election results also have the opportunity to warm up the Sino-US game. The Hang Seng Index can be found at the end. Based on the current high scores of the Democratic Party, the short-term market should still be able to rebound.
The mainland housing sector has also become a powerful target for the market to rebound. Citigroup reported that 34 listed Chinese property stocks have reached the full-year target of 84% in 2018 this year. It is expected that sales will rise 28% year-on-year. According to preliminary estimates, sales will still increase by 22% year-on-year. The mainland property market is only adjusted in the coming year. It is not a collapse. It can re-examine the value of the inner housing sector. The central government has introduced measures to support economic stability. I believe the profitability of the domestic housing industry is limited. . The bank is optimistic about China Resources Land (01109), Longhu Real Estate (00960) and China Jinmao (00817). The three stocks rose by half to over 7% yesterday. Citigroup gave a Buy rating; the bank is also optimistic about Xincheng Development (01030) , Sunac China (01918) and Longguang (03380), giving target prices of 11 yuan, 48.08 yuan and 16 yuan.
However, the author maintains a rebound in the domestic housing sector and is difficult to rebound. In the short-term, the central government will maintain stability. However, the de-leverage policy is only flexible. Due to the weak central bank of the RMB, enterprises can only rely on overseas dollar debt financing, and the risk is not light. The slowdown in economic growth tends to be unchanged, and at this stage it can only be seen as a technical oversold rebound.
As for the relevant shares that were once expected to accelerate the infrastructure projects for the stability of the central government, the industry’s third-quarter performance generally exceeded expectations, catalyzing a period of adjustment. However, in the face of the central government’s downward pressure on the establishment of the economy, it will bring back an excuse for this sector that is conducive to speculation. Earlier, JP Morgan Chase issued a report that the new order data in the third quarter was worse than expected, mainly due to the recent focus of the mainland to restart the approved existing infrastructure projects, but the recent stimulus and funding relief measures are expected to be in the fourth Since the beginning of the season, the industry has had a significant impact. It is expected that the profit growth of the existing high-profit PPP projects will be accelerated, and the industry’s profit growth is expected to accelerate. Therefore, China Railway (00390) and China Railway Construction (01186) are optimistic.
Big line sings well, infrastructure cement is desirable
From the recent central government’s intention to increase investment in directional orientation, the infrastructure sector has always been preferable. Yesterday, there is similar remarks in the company. It is expected that the industry will improve in the fourth quarter, and the target price of China Railway will be raised from 7.7 yuan to 8.5 yuan. Shares closed at 7.41 yuan yesterday, up 5.86%; China Railway Construction closed at 10.4 yuan, up 4.84%.
Building materials cement stocks also recorded a considerable increase. Earlier, the National Development and Reform Commission announced that the national cement industry in the first three quarters increased by 1% year-on-year, down 0.5% from the same period of last year. Cement prices in September rose by 29.2% year-on-year, making the first eight months of building materials industry The profit was 286.8 billion yuan, up 46.1% year-on-year; the cement manufacturing industry realized a profit of 96.3 billion yuan, an increase of 1.5 times. China Resources Cement (01313) rose 7.67% yesterday, Jinyu (02009) rose 2.31%, Conch Cement (00914) rose 5.68%, and China National Building Materials (03323) blasted 6.6%, reflecting the stock’s earlier cumulative decline, with the market Oversold, the technical rebound is strong.