The U.S. Federal Reserve is eagle-eyed, but the big Wall Street players put the conventional wisdom of “don’t fight the Fed” in the trash. U.S. stocks have risen for two consecutive days, especially interest-sensitive technology stocks are the most resilient. Driven by U.S. stocks, Hong Kong stocks followed suit, and the Hang Seng Index opened higher by more than 200 points. The Hang Seng Index closed up 301 points at 16,914 points, up 525 points for three consecutive days. Market turnover rose to 99.7 billion yuan.
CLP’s operating conditions have not been seen for many years
One of the reasons for the rebound in US stocks is that the performance announced by the bank stocks is not too bad, mainly because the interest rate spread has widened due to the upward interest rate. However, the company’s performance is lagging data. In the second half of the year, inflation in the United States has begun to attract attention. The interest rate increase will be really high first. If you want to look at the US market, it may be more valuable for the Christmas sales later. Compared with U.S.-listed companies, the tide of Hong Kong companies ebbs faster, mainly because the social operations in China and Hong Kong have not returned to normal, and the price of raw materials has risen as strong as the US dollar. The impact on corporate profits has already emerged. It seems that CLP (002) announced its business in the first nine months at the beginning of the week. Due to the slow recovery of economic activities in summer due to the epidemic, Hong Kong’s electricity sales fell by 2.3%, of which residential and manufacturing electricity sales fell by more than 4%, while infrastructure and public service electricity sales fell by 2.3%. A slight increase, due to the sharp rise in international fuel prices, the net electricity price has risen by more than 10% since January, and it is estimated that fuel costs will continue to be under greater pressure. Similarly, the business in Australia continues to be under pressure due to rising costs. It can be estimated that the business has been operating hard throughout the year, which has not been seen in many years.
CLP has always been a typhoon shelter for capital, but this time it is a typhoon shelter. The stock price has dropped 32% from a high this year. CLP fell yesterday, closing at 53.5 yuan, down another 1.3% to a new low for the year. After the share price slumped, the dividend yield rose to 5.8%, a figure that has never been seen before. It seems a bit appealing to a lot of stable-minded people who buy stocks and pay dividends. However, the United States is reporting that the interest rate will be increased by 1.5% this year, and there will be two or three surges in dividend-paying stocks at any time, so even if you want to buy, it is best to take a light taste as the bottom line, and save a lot of money to add more. Attack only when you are resting.
Another example is Johnson Electric (179). The company issued a profit warning yesterday. It is expected that the interim profit as of the end of September will drop by about 40% year-on-year. The same period last year recorded a profit of US$93 million. The decline in earnings was attributable to the significant depreciation of the Euro against the US dollar during the period, coupled with the adverse effects of rising raw material and logistics costs, continued shortage of semiconductors and increased operating costs. Excluding assets and liabilities denominated in foreign currencies and non-cash movements in unrealised foreign exchange revaluation losses incurred on foreign exchange contracts at the end of September, underlying earnings for the first half of the year fell by approximately 16% year-on-year.
The pressure on Johnson’s earnings was expected, but the operating environment in the third quarter deteriorated more than expected, and the company is still able to make money. Since the company’s revenue has a lot of non-US dollars, the continued strength of the US dollar may not dissipate this year, so it is not certain that the worst time has passed. Johnson jumped 7% yesterday and closed at 7.65 yuan, up only 1.6%. In the difficult environment this year, the company’s turnover can maintain growth regardless of the exchange rate factor, which shows its competitiveness. The Group is the world’s leading motor manufacturer and has international advantages. However, such industrial stocks are in an unfavorable environment and may not have bottomed out. If you buy them and hold them for a long time, you will have to pay for a period of time at any time.
Short-term speculation in popular stocks wins
The tide of interest rate hikes in the United States has set off waves. Even if you hide in a typhoon shelter, you will be buried in the flood. If you don’t have a solid foundation and can withstand short-term losses, you should only make small bets and short-term speculation. This kind of game is not suitable for slow dividend-paying stocks. It seems that the market rose 301 points yesterday, and the science and technology sector was hot across the board. Tencent (700) rose 3% to close at 254.4 yuan; Meituan (3690) closed at 154 yuan with a similar increase; Ali; Baba (9988) surged 4% to close at 76 yuan; JD.com (9618) rose 3.7% to close at 178.3 yuan; Xiaomi (1810) rose nearly 5% to close at 9.14 yuan; Ali Health (241) jumped 9% to close at 3.62 yuan , the blue chip with the largest increase in the whole day. The report of the 20th CPC National Congress emphasized that education, technology and talents are the foundation of China’s development into a strong country. BYD (1211) is expected to increase its profit by more than 2.7 times in the first three quarters, and it is expected that the third quarter profit alone will increase by more than 3.34 times. BYD’s share price rose 6% , closed at 205 yuan, the valuation of these large stocks is not high, the advantage of short-term speculation is that you can quickly enter and exit.
It is reported that the Hong Kong government is considering amending the ban to allow re-export trade of products such as e-cigarettes from land and sea through Hong Kong, which is expected to involve billions of trade volumes each year. Electronic cigarette concept stocks are generally doing well. BYD Electronics (285) jumped 11% to close at 20.15 yuan; China Tobacco Hong Kong (6055) rose 4.6% to close at 8.49 yuan; “the first electronic cigarette” Smol (6969) was hit by Yamato Capital downgraded the rating, and the stock price bucked the trend and fell 1.3% to close at 8.82 yuan.
Jin Riku