Happy Friday, traders!
Today, protest disruptions have lessened, though an elderly man hit on the head with a brick has died and two others -- including the man set on fire and a 15-year old boy reportedly hit on the head by tear gas canisters -- remain in critical condition.
Traders are going back into Hong Kong stocks, looking for bargains.
We will keep you up on the latest news and moves in mainland and Hong Kong markets.
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-- Zhang Shidong in Shanghai and Deb Price in Hong Kong
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This article originally appeared in the South China Morning Post (SCMP), the most authoritative voice reporting on China and Asia for more than a century. For more SCMP stories, please explore the SCMP app or visit the SCMP's Facebook and Twitter pages. Copyright © 2019 South China Morning Post Publishers Ltd. All rights reserved.
Copyright (c) 2019. South China Morning Post Publishers Ltd. All rights reserved.
* Overnight markets/ What futures foretell
-- Overnight in US markets, the S&P 500 gained 0.1 per cent, the Nasdaq fell less than 0.1 per cent, and the Dow Industrials was little changed
-- Hong Kong futures were 0.5 per cent higher, while the FTSE China A50 futures climbed 0.4 per cent
* IPO debuts: Sinic Holdings (Group) (2103 HK), China Pengfei Group (3348 CH) and Best Linking Group Holdings (8617 HK) will start trading in Hong Kong today.
Suntar Environmental Technology (688101 CH) and Novoray (688300 CH) will debut in the Start Board in Shanghai, while BSM Chemical (300796 CH) will begin its first day of trading in Shenzhen.
* Economic statistics/Central Bank action: China's October home prices will be due at 9:30am today.*
Corporate events: earnings, meetings, news conferences
-- nothing major
China Merchants Securities boosts target price of Tencent, maintains 'buy' rating
Tencent (700 HK) is getting a mixed report card after its profit and revenue misses on Wednesday after market close.
Here are two new ones:
China Merchants Securities (Hong Kong) increased the target price of Tencent to HK$422 from HK$392 and maintained a "buy" rating on the stock.
Mizuho Securities USA reduced the target price to HK$325 from HK$335, and maintained its "neutral" rating.
Tencent fell 2.3 per cent to HK$319.80 on Thursday after its results.
Alibaba picks auspicious numbers for its Hong Kong listing
Alibaba Group Holding has picked auspicious numbers for both its stock code and set the offer price for retail investors in its sale of new shares in Hong Kong, after receiving overwhelming response for the global tranche of its US$13.86 billion secondary listing, according to investment bankers and sources familiar with the plan.
The shares will be offered at no more than HK$188 (US$24) each, according to sources, declining to be identified for discussing matters that have not been announced. This is 3.3 per cent higher than the November 12 closing price of Alibaba's New York-traded depositary receipts after allowing for a one-for-eight split, based on Alibaba's filing to the Securities and Exchange Commission on Tuesday.
The stock's code on the Hong Kong stock exchange is 9988, which rhymes with "prosperity forever." The numbers eight and nine are considered auspicious in both Cantonese and Mandarin Chinese.
Read full story here by Peggy Sito and Enoch Yiu
EV maker BYD sees its US plans stuck as anti-China sentiment grows
BYD - a Shenzhen-based electric vehicle maker whose name is short for Build Your Dreams - opened its US bus factory in Lancaster, California, in 2013. Six years later, those dreams risk becoming nightmares as anti-China sentiment in Washington grows.
The way BYD (1211 HK; 002594 CH) sees it, it's been a model corporate citizen. It has invested US$250 million in a small American community; created 800 unionised manufacturing jobs; built environmentally friendly products; and followed "Buy America" requirements by sourcing 70 per cent of its components from US companies.
"If BYD was a Danish company, we'd be held up as an example of what the US wants us to do," said Zachary Kahn, the company's US director of government relations. "We've come in, manufacturing in the US for the benefit of union labour and the community.
But the way critics see it, BYD is a tool of the Chinese Communist Party that's gaming a free-market system, poised to spy on bus riders and activate kill switches remotely to block intersections, spewing chaos.
Read full story by Mark Magnier here.
Hua Medicine says it is confident it will get marketing approval for diabetes drug
Hua Medicine (2552 HK), whose shares have shed more than 40 per cent this week after the interim clinical trial results of a diabetes drug did not meet investors' expectations, said it was confident of receiving marketing approval from Chinese regulators.
"The results were good ... [as] some investors are probably not well-informed of the trial requirements and the advantages of the drug over existing products on the market," chief financial officer George Lin Chien Cheng said on Thursday. "On top of that, they were concerned about the implications of [China's] ongoing price cutting of generic drugs via mandatory government hospital bulk tenders."
Lin attributed the high reading to the fact that this was the first time that a novel diabetes drug has gone through phase three trial in China, where regulators have yet to set guidelines for such trials but have demanded that patients be subject to doctors' check-up every four weeks.
The patients, mostly recruited from rural areas and who had not previously been prescribed diabetes drugs, were also told to watch their carbohydrate intake and encouraged to exercise more as diabetes patients are normally told.
Read full story by Eric Ng here.
Beijing-Shanghai High-Speed Railway operator's IPO gets green light
Beijing-Shanghai High-Speed Railway operator's initial public offering got the green light from China's top securities watchdog.
The China Securities Regulation Commission said that it has approved the application of Beijing-Shanghai High-Speed Railway Company to float on the Shanghai Stock Exchange, according to a notice on November 14.
The rail company will offer up to 7.557 billion shares, according to the filing, and all proceeds will be used to buy a 65 per cent stake of Beijing Fuzhou Railway Passenger Dedicated Line Anhui Company for 50 billion yuan in that would be the largest fundraising exercise on the mainland in more than nine years.
In another words, China State Railway Group, which owns a 50 per cent stake in the high-speed operator through its investment arm, wants to use its share of the profits to shore up less profitable lines.
Beijing-Shanghai High-Speed Railway, which operates the 1,300 km line, reported its net profit hit about 10.25 billion yuan in 2018, up more than 13 per cent from 2017, according to its prospectus on October 22.
Tencent gains on rising Hang Seng
The Hang Seng perked up this morning, rising 0.6 per cent to 26,492.76, after falling two straight days on escalating violence.
Tencent (700 HK), Thursday's top loser with a decline of 2.3 per cent, rose 0.4 per cent to HK$321. The drop came after its third quarter revenue and profit missed estimates. A raft of new ratings have been coming out for the Chinese Internet giant.
The other two heavyweights on the benchmark were mixed.
AIA (1299 HK), the giant insurer and financial service provider, rose 1.3 per cent to HK$77.40, while HSBC (5 HK) dropped 0.9 per cent to HK$57.85.
Apple supplier AAC Technologies (2018 HK) continued to rise, climbing 1.8 per cent to HK$51.20. It was the top percentage gainer on Thursday, rising 3.7 per cent to HK$50.30.
Bank of Communications (3328 HK), whose Central branch's front window was smashed, on Wednesday, rose 0.2 per cent to HK$5.2.
China's stocks drift lower at open, head for weekly loss
The Shanghai Composite Index slipped 0.1 per cent to 2,906.20 at the open today, extending its weekly loss to 2 per cent.
Pig and chicken-breeding stocks such as Muyuan Foodstuff (002714 CH) and Shandong Minhe Animal Husbandry (002234 CH) led the decline on concern rising pork and chicken prices will deter consumers and hurt sales.
-- Zhang Shidong
3 IPOs in Hong Kong start off flat
Sinic Holdings (Group) Company Limited (2103 HK) and China PengFei Group Limited (3348 HK) started trading on the main board of Hong Kong Stock Exchange, and Best Linking Group Holdings Limited (8617 HK) debuted on the GEM board.
Sinic's share price opened flat, at the offering price of HK$ 3.98. The shares were undersubscribed by 74 per cent.
The property developer Sinic was ranked by the China Real Estate Index System as the 31st among the top 100 property developers in China in terms of comprehensive property development ability.
Shares of China PengFei Group opened flat, at the offering price of HK$ 1.58. The shares were oversubscribed by 26.72 times.
As the largest supplier of rotary kilns, which are used to produce industrial materials such as cement, lime and metals in China and globally, China PengFei Group had revenue in 2018 that accounted for 22 per cent of the Chinese market and 13.3 per cent of global market, according to a Frost & Sullivan market research report. Apart from rotary kilns, PengFei also provides tube mills, roller presses, vertical mills, separators, and ancillary machinery.
Shares of Best Linking's share price also was flat, at the offering price of HK$ 0.55. The shares were oversubscribed by 61.67 times.
Best Linking manufactures slewing ring, which is an essential component of large machinery for construction, wind engines, military, and robots. According to the Industry Report, it was ranked fifth among the slewing ring manufacturers in China in 2018 in terms of sales revenue to overseas markets, with a market share of 1.3 per cent.
Sinic Holdings (Group) Company Limited (2103 HK) and China PengFei Group Limited (3348 HK) debut on the main board of Hong Kong stock exchange, and Best Linking Group Holdings Limited (8617 HK) debut on the GEM board today. @scmpbusiness @SCMPNews pic.twitter.com/NrzgH3hdEl
-- Snow Xia (@SnowXia05) November 15, 2019
-- Snow Xia
Star board debutants surge in Shanghai
Two listings surged on their first day of trading on the Science and Technology Innovation Board, or the Star market, in Shanghai today.
Novoray (688300 CH), a maker of crystalline silica powder used in integrated circuits, surged by as much as 65 per cent from the IPO offer price before trading up 52 per cent recently to 41.50 yuan.
Suntar Environmental Technology (688101 CH) jumped by as much as 40 per cent and the stock recently traded at 23.98 yuan, an increase of 31 per cent from the offer price.
Meanwhile, BSM Chemical (300796 CH) rallied by 44 per cent to 20.52 yuan in Shenzhen.
New listings on the Star market have no restrictions on daily price movements in the first week of trading, while those on the main board are subjected to a 44 per cent gain in debut and then can go up or down no more than 10 per cent in a day.
-- Zhang Shidong
AAC Technologies jumps after announcing US-dollar denominated 'refinancing and development' plan
AAC Technologies (2018 HK) jumped nearly 4 to HK$52.30 after announcing it will issue US dollar-denominated notes for "refinancing and development" of its business.
It is the top gainer in morning trading on the Hang Seng Index.
It is the second day of gains for the Apple supplier, which made its announcement this morning in an exchange filing.
It was the top gainer Thursday on the Hang Seng Thursday, rising 3.7 per cent.
BeiGene soars after lymphoma drug gets FDA accelerated approval
BeiGene (6160 HK) soared 7.7 per cent to HK$126.40 , after announcing its lymphoma drug Brukinsa has received accelerated approval by the US Food and Drug Administration.
"BRUKINSA is the first BeiGene-discovered product to be approved, an important milestone toward the Company's goal of transforming treatment for cancer patients around the world," BeiGene said in its announcement posted at the stock exchange.
The drug is would treat mantle cell lymphoma (MCL) -- an aggressive blood cancer -- in adult patients who have received at least one prior therapy.
"We are working to improve outcomes for people with cancer worldwide and this approval brings us closer to realizing our mission of bringing the highest quality therapies to patients globally," said John V. Oyler, chairman and co-founder, and CEO of BeiGene.
"The approval of BRUKINSA as a second line therapy represents an important advancement for the treatment of mantle cell lymphoma," said Meghan Gutierrez, CEO for the Lymphoma Research Foundation. "Expanded treatment options can transform the patient experience and provide hope to people living with a mantle cell diagnosis."
Huobi Technologies continues its run
Huobi Tech (1611 HK) continued its run in early trading, rising 3.2 per cent to HK$6.14.
On Thursday, it announced in an exchange filing that its name has been officially changed from Pantronics.
Since the Huobi cryptocurrency exchange announced on September 10 it would change the name of the Hong-listed Pantronics it acquired earlier, it has skyrocketed.
Meanwhile, Singapore-based Grandshores Technology (1647 HK), which operates construction and blockchain business, fell 1.4 per cent to HK$73, giving up early gains in thin trading.
Chinese pig-feeding stocks fizzle
The stellar run of China's pig-farming stocks seems to have run out of steam.
They are leading the pack of decliners today, with Muyuan Foodstuff (002714 CH) and Hunan New Wellful (600975 CH) falling at least 3.5 per cent.
Several theories could explain the reversal, from the release of more frozen pork into the market to demand being dented by high-flying prices.
Pork prices registered second consecutive week-on-weekly declines as of last week, the Securities Times reported, citing the agricultural minister.
Chicken-farming companies also fell: Shandong Yisheng Livestock and Poultry Breeding (002458 CH) and Shandong Minhe Animal Husbandry (002234 CH) retreated at least 4 per cent.
-- Deb Price
Tencent sees two more lowered price targets
Internet giant Tencent (700 HK) is being reevaluated by analysts, following its profit and revenue miss on Wednesday after market close.
Here are a few of the latest:
ABC International lowered its 12-month target price on Tencent to HK$328 from HK$360, while maintaining its "hold" rating.
CCB International Securities trimmed its price target to HK$400 from HK$410, while keeping its "outperform" rating.
Tencent has see-sawed in morning trading. It is now ahead 0.1 per cent to HK$320.20.
Calm returns to China's markets
Price swings on Chinese stocks, known for its wild volatility, are dropping.
The 100-day volatility on the Shanghai Composite Index slipped to its lowest level since February 2018, while the 30-day gauge also dropped to that low, according to Bloomberg data.
The Shanghai Composite has been stuck in a 100 plus-point range over the past two months, as stocks sway between the prospects of a trade deal and more policy easing and angst about the worsening economic outlook.
The market may soon choose a direction to break the ice, according to Xun Yugen, a strategist at Haitong Securities in Shanghai.
Stocks will trend up as earnings growth may have already troughed in the third quarter, he said.
-- Zhang Shidong
Traders are bargain shopping among Hong Kong battered stocks, says analyst Alan Li
Traders are doing some bargain hunting this morning, says Alan Li, portfolio manager at Atta Capital.
"Worry on curfew and cancellation of district election has been relieved. People are starting to bottom fish Hong Kong-related stocks," he said.
"But it is not easy for the rebound to go further, as there is still uncertainty on protest action during weekend," he cautioned.
Hua Medicine soars after reassurances by management about diabetes drug
Hua Medicine (2552 HK) rebounded 21.4 percent in morning trading to HK$5 after a 40 per cent plunge over the previous three days, after management said it was confident it will receive marketing approval for its diabetes drug from Chinese regulators.
Investors were concerned about trial results that showed a high level for a placebo.
The patients, mostly recruited from rural areas and who had not previously been prescribed diabetes drugs, were also told to watch their carbohydrate intake and encouraged to exercise more as diabetes patients are normally told, he said.
Full story here on Li's presentation.
-- Eric Ng