Global Manufacturing/PMI: RIO and China banks
More positive data-points for stocks linked to improvements in Global PMIs. China PMI is at 18 month highs, manufacturing data from Singapore, Indonesia and Taiwan has also been strong and even the...
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We expect the unexpected on Chinese Banks
“…China should “appropriately” ease limits on commercial banks’ operations to lessen the impact of interest rate liberalization. Should ease or eliminate the loan-to-deposit ratio requirement in the...
View ArticleChina Banks have the most upside (for those that can)
We have been marketing this call for c5 months. They are under owned and undervalued on trough valuations, P/B 1x, P/E 5x, yield 5.5-6.0%. NPLs remain contained on average below <1% despite NPL...
View ArticleLook East to China Banks, stay long
“NPL ratio at 0.91% was excessively good.” ICBC Chairman. This is from a very good, and rather frank interview with the Chairman of ICBC (in today’s FT) who like us, is miffed by the excessive...
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China reform drumbeat – BUY the Banks
China seems to be moving forward with financial reform with news out yesterday that rules have been drafted banning banks from evading lending limits by structuring loans to other financial...
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Policy Drumbeat – China Deposit Insurance
Comments from the PBOC are coming out thick and fast with some reporters attributing yesterday’s broad equity strength to comments made by the vice Govenor of the PBOC (Yi Gang) during an official...
View ArticleCHINA – CBRC prefers the Banks
CBRC will support the sale of preferred shares and bonds with write-down provisions by commercial banks to expand channels for bolstering capital accordingf to Shanghai Securities News (citing Jia...
View ArticleChina PMI – stable growth despite lending restraint
Despite new incremental total social financing shrinking further in Oct (in particular due to restraint in off Balance sheet financing) and well before new policy has moved to action, it is encouraging...
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China Cinda – Pricing today
Cinda lists on the 12th of Dec and prices today. Price range implications to valuation are as follows (although rumours are that it will price at the top); The call on Cinda’s valuation is whether to...
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Chinese Banks: still bearish?
Cindra IPO 20x covered at institutional level. Retail tranche is 160x o/s (only 5% of the issue). Not bad for a “Bad Bank”.
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Focusing on the losers
In September and October we highlighted that our performance was hampered by our exposures to US yield curve exposed companies, but that the correlation was encouraging and so it may have been time to...
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China – Is good news good news?
It seems the world is at a cross roads where good news remains bad news both in the US and China. Economic improvements in the US are still being greeted with distain; causing taper tantrums in Asia,...
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CINDA – Shareprice implications (listing in HK today)
Apparently the institutional book was covered at least 20X with 160X coverage of the retail tranch. CINDA (1359 HK) Shareprice implications below; Grey market is suggesting a 16% rally from list price...
View ArticleChina Banks, important for global risk
Our non consensual Bullish view on the Chinese Banks has been further supported by the first two Chinese Banks to report, Agricultural Bank and Bank of China. As we have continuously highlighted, the...
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China municipal bond market
The Ministry of Finance last week announced a program that will allow 10 provinces and cities (4 cities: Beijing, Shanghai, Shenzhen, Qingdao and 6 provinces: Zhejiang, Guangdong, Jiangsu, Shandong,...
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Out of US into EM
Last week global equities saw $7bn outflows of which the US accounted for 11.1bn withdrawals vs Emerging Markets that saw net inflows of $1bn. This data coincides with the fact that market breadth for...
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China Banks are leading this rally – the first time in 3 years
Banks continue to lead this rally (for the first time in 3 years). In fact, they remain the only sector with positive performance in down days in the domestic market. BUY THE BANKS leading the rally,...
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China RRR and PMI beats
RRR cut Last week we spoke of the signals we were seeing for an imminent RRR cut (including interbank treasury maturity divergence) and highlighted the State Council’s predisposition to announcing...
View ArticleMay property data POSITIVE – Sales and ASPs grow month on month
With news of Shanghai’s new home ASPs rising to 29,631 RMB/sqm for the week ended 8th June (up 3.15% from the previous week), we note that half of the 36 property companies in China have now reported...
View ArticleHousekeeping – the Banks
RMB starting to appreciate post strong trade balance. Chinese Banks leading the A share market higher on divergently positive volumes. Property results in May implying risks more than manageable Trust...
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