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China Stock Turmoil 2015
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The Shanghai and Shenzhen exchange indices are shown in an electronic board in the Pudong financial district of Shanghai. Photo: Reuters

Live | China Markets Live - Shanghai and Hong Kong ends lower; but Shenzhen defies trend to settle higher

Welcome to the SCMP's live markets blog. The intense volatility of recent weeks has every chance of remaining the core underlying theme of activity, especially as the roughly 1,400 shares that were suspended at the peak of the stock market rout gradually resume trading - they are likely to be prime targets for price adjustments. Meanwhile investors are increasingly focused the broader question of how this episode might affect the wider economy as many suspect the equity bubble has yet to fully deflate. We'll bring you the key levels, trading statements, price action and other developments as they happen.

 

4:15pm: Extending the weakness in financial companies from mainland China, all major lenders and insurers finished in the red, while investors also took profit from Hong Kong Exchanges and Clearing Ltd, which dropped 2.5 per cent to HK$233.6 after UBS said the daily turnover is expected to slow to HK$100 billion, down from HK$127 billion in the first half of the year.

 

4:13pm: The Hang Seng index fell 0.44 per cent to finish at 25,112.06, with HK$126 billion worth of shares exchanging hands, compared with Monday’s HK$136.8 billion. 

4:13pm: The H-share index, a gauge of Hong Kong-listed mainland companies, retreated 1.4 per cent to close at 11,836, dragged by Great Wall Motor and insurer PICC Casualty & Casualty, which each posted a 4 per cent decline.

4:08pm: Beijing Media has gone 75 per cent up to HK$9.10, making it the top percentage gainer today, having opened 31 per cent up. The stock is at an all-time high, having catapulted northwards by more than 250 per cent since a week ago.

3:51pm: China LNG was suspended from trading over the midsession break, having most recently traded at HK$1.46, as Glaucus Research issued a strong sell recommendation. 

Glaucus says China LNG’s price to book ratio is 18.99 times greater than the average of Hong Kong listed and global energy companies – more overvalued than Hanergy. It also says the China LNG’s stock is trading at 19,917 times annualized sales of its LNG business and places its real value at just 8 HK cents per share.

3:42pm: Hang Seng Index at 25,100.26, down 132.81 points or by 0.49 per cent.

3:39pm: Decline in Shanghai Composite saw more than 900 companies suspended from trading after touching on daily limit of 10 per cent. 

Weakness was most evident in brokerages and banks. Only one out of 25 listed brokerages in Shanghai finished in the black, with Huatai Securities leading losses by shedding 8 per cent. 

Banks in Shanghai dropped in a range between 1 to 4 per cent, with Citic Bank and Bank of China being the exception, rising 8.4 per cent and 0.38 per cent respectively. 

Shanghai-traded shares in Citic bank dropped almost 5 per cent at one stage in the morning, before finishing up almost 9 per cent, without any visible catalyst to spur the stock price. The shares in Hong Kong rose moderately by 0.51 per cent. 

Trading in Shanghai and Shenzhen increased to 1.32 trillion yuan, up from Monday’s 1.17 trillion yuan.

3:07pm: In Hong Kong, the Hang Seng index retreated 0.72 per cent to 25,043.12, with HK$106 billion worth of shares exchanging hands. 

Macau casino operators Galaxy Entertainment and Sands China led the gainers, rising 5.36 and 4.85 per cent respectively to the highest level in a month. 

The H-share index gave up 1.64 per cent to 11,807, dragged by a 5 per cent decline seen in the share price of insurer PICC Property & Casualty.

3:03pm: The Shanghai Composite Index dropped 1.16 per cent to close at 3,924.49, after briefly touching on 4,000 mark at one stage in morning trade. It had also done the same thing on Monday. 

3:03pm: The CSI300 Index went down by 2.37 per cent to 4,112.15 at close.

3:03pm: Shenzhen Composite Index rose 1.38 per cent to end at 2,149.52, while the ChiNext board added 1.60 per cent to 2,726.05.

2:35pm: The Shanghai Composite Index dropped 0.59 per cent to 3,946.93, after briefly touching the 4,000-point mark at one stage in the morning trade. 

The CSI300 Index went down by 1.49 per cent to 4,149.12. Shenzhen Composite rose 1.96 per cent to 2,161.64, while ChiNext board added 2.74 per cent to 2,756.17.

2:33pm: Hong Kong brokers have been more active in chasing margin calls from clients in recent days to reduce risks in a volatile market, while HKEx increased the initial margin for Hang Seng Index futures to HK$121,900 from Friday, up from HK$101,000 previously. For more on this story, click here.

2:00pm: Shenzhen Composite Index gains 1.47 per cent or 31.25 points at 2,151.49. ChiNext trade at 2739.21, up 2.09 per cent or 56.14 points. 

1:49pm: Shanghai Composite Index loses 0.827 per cent or 32.82 points to 3,937.57. CSI300 Index slides 1.454 per cent or 61.22 points to trade at 4,150.59. 

1:48pm: Hang Seng Index slips 0.88 per cent or 221.01 points to 25,003.00. H-shares Index stands at 11,780.28, down 1.86 per cent or 223.55 points. 

1:40pm: In Hong Kong, Linmark Group has reversed its midsession position, going from 7.4 per cent up to 8.7 per cent down, after announcing its final results for the past financial year which saw profit decrease by 62 per cent. It is now trading at HK$1.47.

1:11pm: Shanghai Composite Index falls 0.92 per cent or 36.45 points to 3,933.94. CSI300 Index stands at 4,148.01, down 1.52 per cent or 63.8 points. 

1:06pm: Hang Seng Index falls 0.52 per cent or 131.26 points to 25,092.75. H-Shares index at 11,832.32, extending its losses to 1.43 per cent or 171.51points. 

12:54pm: As Hong Kong prepares to resume trading after lunch, turnover stands at just HK$67.81 billion on the main board and HK$702 million on the GEM. 

On the Shanghai-Hong Kong stock connect, local investors have bought 2.23 billion yuan and sold 2.36 billion yuan in China stocks. Mainland investors have bought HK$1.59 billion and sold only HK$841 million in Hong Kong stocks.

12:49pm: HK Electric Investments, a firm controlled by tycoon Li Ka-shing that owns the electricity monopoly in Hong Kong Island and Lamma Island, posted a net profit of HK$1.2 billion for the year’s first six months, compared to a profit of HK$967 million in the period from January 29 last year when it was spun off into a separate Hong Kong-listed firm, to June 30 last year. 

12:47pm: Shares of Wanda Cinema Line, controlled by billionaire Wang Jianlin, rose 4.8 per cent on Tuesday morning to 186.50 yuan after the company announced a slew of plans to defend its price performance in the mainland’s volatile stock market. For more on this story, click here.
12:24pm: After US$3 trillion crash discount, BNP says just 24 China stocks are worth buying. For more on this story, click here.

12:03pm: The Hang Seng Index closed the morning session down 0.58 per cent, or 145.09 points, to stand at 25,078.92, while the H-share Index fell 1.48 per cent, or 177.09 points, to 11,826.74. 

11:55am: China’s broad M2 money supply in June jumps 11.8 percent from a year ago, pacing up from May 's growth of 12.8 per cent, while outstanding renminbi loan growth was 13.4 per cent in June, says PBoC website. 

11:53am: Solartech International leapt by 56 per cent in morning trading taking its share price to 33 HK cents. Last night, the industrial/energy firm announced plans to place shares amounting to around 20 per cent of its issued share capital at 17 HK cents per share. 

11:53am: Pegasus Entertainment is also a winner, jumping 37 per cent to HK$2.99, having yesterday offered out options for 40 million shares of 1 HK cent each with an option exercise price of HK$2.18 per share. 

11:53am: SMI Holdings fell 11.8 per cent to 82 HK cents having terminated a share placing agreement in view of unstable market conditions.

11:52am: Cypress Jade Agricultural Holdings has suspended itself from trading having gained 29 per cent to 53 HK cents this morning. After close of trading yesterday, the company announced the divestment of its 100 per cent equity stake in the loss-making Trade Rise Holdings for HK$6 million.

11:47am: China’s central securities clearing house says it will closely monitor brokerages’ account services, and reiterated all institutions must insure their new clients sign up with their real names, according to official China Securities Depository and Clearing website. 

11:36am: China finance stocks are again among the most heavily traded in Hong Kong, but results are less positive than yesterday and the Hang Seng China H-Financials Index is down 0.79 per cent or 149.8 points to 18,709.07. 

Ping An has surrendered top spot in turnover to Tencent and has dropped 0.77 per cent to HK$96.60. ICBC is down 1.04 per cent, Bank of China is off 0.66 per cent, China Construction Bank is weaker 0.61 per cent, China Merchants Bank slides 0.46 per cent. 

Minsheng Bank has improved its share price by 1.73 per cent to HK$9.39, despite news that New Hope Group had sold off 262 million of its shares. China Life is the other finance major to make small gains.

11:34am: The Shenzhen Composite ended the morning session at 2,169.49, up 2.32 per cent. The ChiNext Index climbed 2.98 per cent or 79.85 points to 2,762.93 before the lunch break.

11:32am: The Shanghai Composite Index is down 0.32 per cent, or 12.55 points, to end the morning session at 3,957.84, and the CSI 300 Index stood at 4,173.29, down 0.91 per cent, or 38.52 points. 

11:30am: The Hang Seng Index stood at 25,094.45, down 0.51 per cent or 129.56 points. The H-share Index dropped 1.33 per cent or 159.89 points to 11,843.94.

11:07am: Bohai Leasing, the mainland-based leasing subsidiary of HNA Group, signs an agreement to purchase 20 per cent of Ireland-based aircraft lessor Avolon for US$428 million (2.6 billion yuan), it said in a notice to the Shenzhen Stock Exchange. 

11:06am: Beijing Media is up 48 per cent to HK$7.70, making it the best-performing H-share at the moment. Meanwhile, Brilliance China Automotive is down 6.3 per cent to HK$10.62, the worst of the red chips. 

Before today’s trading, Brilliance announced an expected half-year profits drop of 40 per cent. In response, HSBC downgraded the stock to ‘reduce’ with a price target of HK$9.60, while Morgan Stanley maintained it at ‘overweight’ with a target of HK$15.

11:05am: Shenzhen Composite Index stood at 2,200.21, up 3.77 per cent or 79.96 points. ChiNext rose 5.33 per cent or 143.06  points to 2,826.14.

11:03am: Shanghai Composite Index up 1.57  per cent or 62.14  points to 4,032.53, regaining 4,000-point level. CSI300 Index went up by 1.03  per cent or 43.54  points to 4,255.35.

11:00am: Hang Seng Index drops to 25195.7, down 0.11  per cent or 28.31 points.H-shares Index slides 0.54 per cent or 64.43 points to 11,939.4.

10:40am: Shenzhen Composite Index stood at 2,181.35, up 2.88 per cent or 61.10 points. 
ChiNext rose 4.39  per cent or 117.85 points to 2,800.92.

10:38am: Shanghai Composite Index up 0.13  per cent or 4.99  points to 3975.38. CSI300 Index down by 0.44 per cent or 18.33  points to 4,193.48.

10:37am: In China, the upward push continues but some of the momentum has dissipated. In Shanghai, 685 companies are trading up, 274 down and 166 unchanged/suspended from trading. In Shenzhen, 923 are up, 191 are down and 484 are unchanged/suspended.

10:35am: Hang Seng Index falls to 25,087.25 , down 0.54 per cent or 136.76 points. H-shares Index down 155.19 points or by 1.29  per cent to 11,848.64.

10:34am: Investor sentiment is chilly on China majors in Hong Kong. Hang Seng’s H-share index shows 37 companies trading negatively and two positively, while its red chip index has 18 stocks down and five up.

10:32am: China’s central bank issues 7-day reverse repurchase agreements worth 20 billion yuan, with a money market rate of 2.5 per cent, pulling 30 billion yuan ($37.46 billion) out of the system, the PBoC website showed. 

10:21am: Kong Sun Holdings is the second-top percentage gainer so far in Hong Kong, improving its share price by 44 per cent to HK$1.15 on resumption of trading. 

Yesterday Kong Sun announced a very substantial acquisition of 100 per cent of a target company with assets including photovoltaic power stations and land, with value between 850 and 1,150 million yuan. 

10:21am: Media distributor Mei Ah Entertainment has bounced back dramatically since bottoming out at 55 HK cents last week, gaining 18 per cent this morning to HK$1.30. It is the most traded of the top 20 gainers with HK$292 million turnover. 

Before it resumed trading today, Mei Ah announced the placing of up to 280 million shares, and subscription for an equal number of new shares, at HK$1 each. 

10:21am: Sands China and Galaxy Entertainment continue to make gains, up 5.3 and 4.4 per cent respectively with combined turnover of HK$712 million, on the back of yesterday’s news that the forthcoming smoking ban in Macau casinos may not be as strict as expected.

10:00am: The Shenzhen Composite Index gained 1.95 per cent to 2,161.50, while ChiNext Index added 2.40 per cent to 2,747.41. 

10:00am: The Hang Seng Index fell 0.40 per cent or 99.95 points to 25,124.06, while the H-share Index was at 11,934.35, down 0.58 per cent or 69.48 points. 

10:00am: The Shanghai Composite Index dropped 0.72 per cent or 28.74 points to 3,941.65. The CSI 300 Index lost 1.21 per cent or 51.13 points to 4160.68.   

9:55am: Heng Koon How, senior currency strategist of Credit Suisse, said:

“Focus now shifts fully to how soon the Federal Reserve will hike rates. This is why the euro trading against the US dollar is much lower since the announcement of the Greek news.  Since then, euro trading against the US dollar had collapsed 2 big figures, from its intra-day high yesterday of nearly 1.12 to below 1.10 now.

The European Central Bank of course remains committed to QE and will continue to keep monetary policy easy going forward, keeping the pressure on the euro. We stay negative on the euro against the US dollar for more weakness to come. For the week, we can expect US dollar to stay broadly strong and euro to stay depressed.” 

The other key event risk will be China’s second quarter GDP update on Wednesday morning.

“Consensus is expecting a slightly weaker GDP than the first quarter. But this is unlikely to affect US dollar and on-shore yuan spot rate, which remains very stable around 6.20.”

9:50am: Onshore yuan is trading at 6.2081, stronger by 11 basis points from Monday close. The offshore yuan stood at 6.2156, weaker by 10 basis points from Monday close.

9:38am: The Shenzhen Composite Index opened at 2,155.69, up 1.6 per cent. ChiNext Index opened at 2,725.04, up 1.5 per cent. 

9:33am: The Hang Seng Index fell 0.16 per cent or 39.95 points to 25,184.06 at the open, while Hang Seng China Enterprises Index lost 0.91 per cent or 109.64 points to 11,894.19. 

9:33am: The Shanghai Composite Index went down 0.3 per cent to 3,958.37 at the start. The CSI300 Index fell 0.7 per cent to 4,178.63 at open. 

9:32am: Since yesterday, expected profit increases have been announced by Hong Kong listed companies Citic Securities, China Shipping Development, AUPU Group and CP Lotus. 

Decreasing profits are expected by Brilliance China Automotive and Success Universe Group. 

Losses are expected by Sinopec Oilfield Service Corporation, Shanghai International Growth Investment, Feishang Anthracite Resources, Evergreen International, Regent Pacific Group, China Yurun Food and VC Holdings. 

Annual reports are out for New Century Group, Goldbond Group, Chun Wo Development and China Jinhai International.

9:30am: Hong Kong listed companies announcing share buy-ups by controlling or substantial shareholders since yesterday, either in Hong Kong or in the mainland as A-shares, include Guotai Junan, Huishan Dairy, China Vast Development, Ozner Water and Shandong Xinhua Pharmaceutical.

9:27am: Hong Kong dollar is trading at 7.7522 to the US dollar, upper end of the currency peg. Euro/dlr weaker by 0.08 per cent at 1.0994. Dlr/yen at 123.64, stronger by 0.17 per cent. Pound/dlr weaker by 0.05 per cent to 1.5479. Australian dollar to US dollar weaker by 0.08 per cent to 0.7401.

9:25am: Hong Kong listed companies resuming trading today include China Zenith Chemical Group, Value Convergence Holdings, Kong Sun Holdings, ZTE Corporation, Asian Citrus Holdings, Merry Garden Holdings and Mei Ah Entertainment. 

During their suspension, VC Holdings announced an expected loss for the past six month period, ZTE announced an A-share repurchase worth up to 1 billion yuan, and Merry Garden entered into a new joint venture. 

A8 New Media has suspended its shares from trading today pending an announcement on a possible connected transaction.

9:20am: People’s Bank of China set the mid-price of on-shore yuan trading at 6.1165, weaker by 32 basis points against the US dollar. Traders are allowed to trade two per cent above or below the mid-price for the day.

9:10am: China’s securities regulator paid a visit to Shanghai-listed Hundsun Technologies Inc, a financial information technology services provider backed by Alibaba’s Jack Ma, to probe the company’s engagement in grey-market margin lending activities, the China Securities and Regulatory Commission spokesman said last night. 

The regulator has cracked down on so-called “fund-matching” companies that distribute loans to investors for leveraged stock bets. Hundsun Technologies is the provider of HOMs cloud-based platform that enables investors to borrow money to invest in equities.

9:05am: The Hang Seng Index futures spot July contract fell 0.73 per cent or 185 points to 24,989 in the pre-opening session. 

9:05 am: Shanghai Composite Index fell 0.006 per cent to 3,970.15 at pre-open session, while the CSI 300 Index dropped 0.002 per cent to 4,211.72.

8:58am: A total of 256 A-share companies announced they would resume trading on Tuesday, including 13 in Shanghai and 243 in Shenzhen.

There are still 112 Shanghai listed A-shares that suspended trading voluntarily last week during the market rout and represent 10 per cent of the total.

In Shenzhen, there are still 613 companies on voluntary suspension, representing 35 per cent of the total.

8:55am: The Hang Seng Index futures spot July contract fell 0.73 per cent or 185 points to 24,989 at the pre-opening session. 

8:10am: Societe Generale China economist, Wei Yao, finds that a crash of the stock market could knock as much as 1.0 percentage point off Chinese GDP growth over the coming year. More worrying is the serious setback that recent actions could bring to long term reform efforts. This could make the growth shock permanent, lowering China’s growth outlook for the next decade from our baseline of 5.5 per cent per annum to 4.5 per cent.

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