Asian equities were mixed as mainland China and Hong Kong underperformed at delta risk. China has blocked Xiamen City, Fujian Province, which has a population of 4.5 million. So far, China has taken a cautious approach to the development of delta variants of the coronavirus. This is the latest in a number of blockades that have slowed economic activity somewhat. The news of the developer Evergrande’s restructuring may also have put pressure on emotions.
SEC Chairman Gary Gensler published an editorial on the Wall Street Journal on Corporate Social Responsibility (HFCA) last night. This work is not new. He reiterated that companies have three years to allow PCAOBs to inspect audit books, and if Congress passes the acceleration bill, the timeline could be shortened to two years. Unfortunately, there is no mention of the China Securities Regulatory Commission (CSRC)’s commitment to “create conditions for audit cooperation with the United States.” The CSRC release is available here.
The wording of the bill and Gensler’s latest statement hold the company responsible for changing its behavior, but this problem can only be resolved through cross-border cooperation between regulators with the rules that the company follows. There is sex. Again, there is nothing new. I would like Gensler to contact their Chinese counterparts to see if a solution can be found. At the CFTC, Gensler emphasized international cooperation between securities regulators. Hopefully he will apply the same tactics at the SEC.
Baidu has begun testing the “Apollo Go” robot taxi in Shanghai. Although taxis are available to the general public, they require a human “driver” to be safe and to monitor their performance. “Apollo Go” is the definition of a futuristic business, which is important given that Uber has abandoned its plans to realize a robot taxi. Baidu took up the mantle extensively.
Barron’s published an interesting article on the restructuring of Chinese real estate giant Evergrande after a puzzled developer had to reschedule debt payments. The article states that restructuring is not “Lehman Brothers in China” and that with government support, the company’s greedy borrowing reductions do not pose a system-wide risk. The article states that specific real estate-intensive ETFs holding high-yield bonds in the Asia-Pacific region have recovered in the past month. Other developers are more cautious, but the real estate sector will follow the government’s “to-do” list before the 13 final meetings, so we should expect more news from the real estate sector. ..NS Party convention in March 2022.
Tencent was a net buy of Southbound Stock Connect and they bought back the stock again overnight.
Kuaishou Technology, a video streaming platform, has been consistently purchased on the part of mainland investors since it was added to Southbound Stock Connect, a program that allows mainland Chinese investors to buy stocks listed on the Hong Kong Stock Exchange. I have come.
H share renewal
The Hang Seng Index was + 0.34% higher than yesterday and fell -1.50% overnight. High-tech and Internet companies contributed most to this decline, as the Hang Seng Index fell -2.27% overnight. The stocks most traded by mainland investors through Southbound Stock Connect were Tencent down -1.09%, Maytuan down -1.13%, Snacks down -11.22% and CNOOC down -0.60%.
Shanghai, Shenzhen, and STAR Board returned 0.33%, -0.05%, and -2.97% overnight, respectively, with -5% less trading volume than yesterday. Foreign investors traded most through Northbound Stock Connect, with rare earths in northern China down -1.96%, dijin mining down -5.41%, CATL up + 5.39% and East Money Information down -2.10. .. %.
Exchange rates, prices and yields last night
- RMB / US $ 6.44 vs. yesterday 6.45
- RMB / Euro 7.61 vs yesterday 7.62
- Yield of 1-day government bond 1.83% vs. 1.73% yesterday
- Yield of 10-year government bond 2.89% vs. 2.89% yesterday
- Yield 3.21% on 10-year Chinese Development Bank bonds vs. 3.21% yesterday
- Copper price-2.02% overnight
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