Asian Hedge Fund Manager, Long Short Equity, Macro

David Mudd

Equity Bottom-Up

<ul>
<li>Hong Kong tech sector leads the market higher with increased momentum and lower volatility.  Short selling has abated with unwind of HKD carry trade.</li>
<li>
<a href="https://www.smartkarma.com/entities/sands-china-ltd" target="_blank" data-smartkarma-citation="entities:182:1" rel="noopener">Sands China (1928 HK)</a> had a breakout from a Falling Wedge pattern. The share price broke above its short-term averages with increasing momentum.
</li>
<li>
<a href="https://www.smartkarma.com/entities/china-feihe-ltd" target="_blank" data-smartkarma-citation="entities:24413:1" rel="noopener">China Feihe (6186 HK)</a> broke out from its downtrend with a Reversal from its U-Shaped Bottom.  <a href="https://www.smartkarma.com/entities/techtronic-industries-co-ltd" target="_blank" data-smartkarma-citation="entities:4561:1" rel="noopener">Techtronic Industries (669 HK)</a> broke out to a new YTD high.
</li>
</ul>


Hong Kong tech sector leads the market higher with increased momentum and lower volatility.  Short selling has abated with unwind of HKD carry trade.

Sands China (1928 HK) had a breakout from a Falling Wedge pattern. The share price broke above its short-term averages with increasing momentum.


China Feihe (6186 HK) broke out from its downtrend with a Reversal from its U-Shaped Bottom.  Techtronic Industries (669 HK) broke out to a new YTD high.



Technically Speaking, Breakouts and Breakdowns: HONG KONG (SEPTEMBER 23)

<ul>
<li>Although Hong Kong markets have slumped after Trump's election, mainland China's markets have gained.  Southbound net buying of HK stocks hit a 2024 high on the day Trump won.</li>
<li>
<a href="https://www.smartkarma.com/entities/sands-china-ltd" target="_blank" data-smartkarma-citation="entities:182:1" rel="noopener">Sands China (1928 HK)</a> had a breakout from a double top as Macau recorded good Golden Week arrivals.  <a href="https://www.smartkarma.com/entities/blue-moon-group-holdings" target="_blank" data-smartkarma-citation="entities:29179:1" rel="noopener">Blue Moon Group Holdings (6993 HK)</a> had a breakout after 3 years.
</li>
<li>
<a href="https://www.smartkarma.com/entities/cansino-biologics-inc" target="_blank" data-smartkarma-citation="entities:27739:1" rel="noopener">CanSino Biologics (6185 HK)</a> formed a breakout after a new vaccine was approved and it reported better results.  <a href="https://www.smartkarma.com/entities/haidilao-international-holding" target="_blank" data-smartkarma-citation="entities:27044:1" rel="noopener">Haidilao International Holding (6862 HK)</a> share price advanced as it expands stores.
</li>
</ul>


Although Hong Kong markets have slumped after Trump's election, mainland China's markets have gained.  Southbound net buying of HK stocks hit a 2024 high on the day Trump won.

Sands China (1928 HK) had a breakout from a double top as Macau recorded good Golden Week arrivals.  Blue Moon Group Holdings (6993 HK) had a breakout after 3 years.


CanSino Biologics (6185 HK) formed a breakout after a new vaccine was approved and it reported better results.  Haidilao International Holding (6862 HK) share price advanced as it expands stores.



Technically Speaking, Breakouts and Breakdowns: HONG KONG (NOVEMBER 13)

HK/China Equity Long-Short

Osbert Tang, CFA

Thematic (Sector/Industry)

<ul>
<li>
<a href="https://www.smartkarma.com/entities/china-southern-airlines-co-ltd" target="_blank" data-smartkarma-citation="entities:1078:1" rel="noopener">China Southern Airlines (1055 HK) </a>will suffer from a higher USD rate as Trump's massive deportation plan raises inflation.  High-cash companies will better position, however.</li>
<li>The surge in tariffs on US imports of goods from China will further accelerate supply chain diversification, boosting intra-Asia trade and driving <a href="https://www.smartkarma.com/entities/sitc-international-holdings" target="_blank" data-smartkarma-citation="entities:15301:1" rel="noopener">SITC International (1308 HK)</a>. </li>
<li>
<a href="https://www.smartkarma.com/entities/cnooc-ltd" target="_blank" data-smartkarma-citation="entities:175:1" rel="noopener">CNOOC (883 HK)</a> may gain from a slowdown in the green transition in the US as oil prices are supported. <a href="https://www.smartkarma.com/entities/meitu-inc" target="_blank" data-smartkarma-citation="entities:23573:1" rel="noopener">Meitu Inc (1357 HK)</a>, given its crypto investments, will benefit. </li>
</ul>



China Southern Airlines (1055 HK) will suffer from a higher USD rate as Trump's massive deportation plan raises inflation.  High-cash companies will better position, however.
The surge in tariffs on US imports of goods from China will further accelerate supply chain diversification, boosting intra-Asia trade and driving SITC International (1308 HK). 

CNOOC (883 HK) may gain from a slowdown in the green transition in the US as oil prices are supported. Meitu Inc (1357 HK), given its crypto investments, will benefit. 


China & HK Strategy: Some Stocks for Trump Trade

Cross Asset Strategy

<ul>
<li>Healthcare sector continues to gain momentum in Hong Kong market during pullback with materials and energy sectors lagging.</li>
<li>Value and Liquidity factors have outperformed since stimulus announcement in September.</li>
<li>
<a href="https://www.smartkarma.com/entities/anta-sports-products-ltd" target="_blank" data-smartkarma-citation="entities:10261:1" rel="noopener">Anta Sports Products (2020 HK)</a> , <a href="https://www.smartkarma.com/entities/jd-health-international-inc" target="_blank" data-smartkarma-citation="entities:29677:1" rel="noopener">JD Health International (6618 HK)</a> and <a href="https://www.smartkarma.com/entities/sands-china-ltd" target="_blank" data-smartkarma-citation="entities:182:1" rel="noopener">Sands China (1928 HK)</a> were rated as BUY as analysts turn toward China consumption plays as future winners.
</li>
</ul>


Healthcare sector continues to gain momentum in Hong Kong market during pullback with materials and energy sectors lagging.
Value and Liquidity factors have outperformed since stimulus announcement in September.

Anta Sports Products (2020 HK) , JD Health International (6618 HK) and Sands China (1928 HK) were rated as BUY as analysts turn toward China consumption plays as future winners.



BUY/SELL/HOLD: Hong Kong Stock Updates (October 15)

<ul>
<li>Hong Kong dollar is strengthening as demand picks up and the carry trade unwinds quickly.  Put/Call Skew declines for HSTech Index as traders sentiment reverses.</li>
<li>
<a href="https://www.smartkarma.com/entities/hengan-international-group-co-ltd" target="_blank" data-smartkarma-citation="entities:29:1" rel="noopener">Hengan International Group (1044 HK)</a> and <a href="https://www.smartkarma.com/entities/galaxy-entertainment-group-limited" target="_blank" data-smartkarma-citation="entities:806:1" rel="noopener">Galaxy Entertainment Group (27 HK)</a> had breakouts from declining wedge patterns and have now formed new uptrends.
</li>
<li><a href="https://www.smartkarma.com/entities/wuxi-apptec" target="_blank" data-smartkarma-citation="entities:23679:1" rel="noopener">Wuxi Biologics (2269 HK)</a> had a breakout reversal from a U-shaped pattern indicating more upside.  The stock's 200 DMA may provide little resistance to further re-rating.</li>
</ul>


Hong Kong dollar is strengthening as demand picks up and the carry trade unwinds quickly.  Put/Call Skew declines for HSTech Index as traders sentiment reverses.

Hengan International Group (1044 HK) and Galaxy Entertainment Group (27 HK) had breakouts from declining wedge patterns and have now formed new uptrends.

Wuxi Biologics (2269 HK) had a breakout reversal from a U-shaped pattern indicating more upside.  The stock's 200 DMA may provide little resistance to further re-rating.


Technically Speaking, Breakouts and Breakdowns: HONG KONG (SEPTEMBER 30)

Hong Kong

Galaxy Entertainment Group Limited, through its subsidiary, operates casino, hotel and other entertainment facilities in Macau. The company also manufactures sells and distributes construction materials.

Price Gauge
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Galaxy Entertainment Group (27 HK)

Technically Speaking, Breakouts and Breakdowns: HONG KONG (SEPTEMBER 23)

Hong Kong tech sector is key to lead the market higher. Lower volatility & decreased short selling volume provide tailwinds for HSTECH index. Sands...

David Mudd

Technically Speaking, Breakouts and Breakdowns: HONG KONG (NOVEMBER 13)

Mainland China's A-share market advanced after Trump's election as South Connect buying hit a 3 year high. Sands China had a breakout as Macau...

David Mudd

China & HK Strategy: Some Stocks for Trump Trade

A higher USD rate due to Trump's deportation plan will impact CSA. Tariff surge on US imports from China will boost SITC. CNOOC may benefit from...

Osbert Tang, CFA

BUY/SELL/HOLD: Hong Kong Stock Updates (October 15)

Healthcare sector gains momentum in HK and materials and energy lag. Anta is appealing to the mass market with new megastores. JDH benefits from...

David Mudd

Technically Speaking, Breakouts and Breakdowns: HONG KONG (SEPTEMBER 30)

Hong Kong dollar strengthens to the strong end of the band. Hengan and Galaxy share prices have both broken out of Falling Wedge patterns. Wuxi...

David Mudd

Price Gauge

52-week Range

Market Cap (USDm)

P/E

Dividend (Yield)

Technically Speaking, Breakouts and Breakdowns: HONG KONG (SEPTEMBER 23)

Hong Kong tech sector is key to lead the market higher. Lower volatility & decreased short selling volume provide tailwinds for HSTECH index. Sands...

David Mudd

Technically Speaking, Breakouts and Breakdowns: HONG KONG (NOVEMBER 13)

Mainland China's A-share market advanced after Trump's election as South Connect buying hit a 3 year high. Sands China had a breakout as Macau...

David Mudd

China & HK Strategy: Some Stocks for Trump Trade

​A higher USD rate due to Trump's deportation plan will impact CSA. Tariff surge on US imports from China will boost SITC. CNOOC may benefit from...

Osbert Tang, CFA

BUY/SELL/HOLD: Hong Kong Stock Updates (October 15)

Healthcare sector gains momentum in HK and materials and energy lag. Anta is appealing to the mass market with new megastores. JDH benefits from...

David Mudd

Technically Speaking, Breakouts and Breakdowns: HONG KONG (SEPTEMBER 30)

Hong Kong dollar strengthens to the strong end of the band. Hengan and Galaxy share prices have both broken out of Falling Wedge patterns. Wuxi...

David Mudd

A higher USD rate due to Trump's deportation plan will impact CSA. Tariff surge on US imports from China will boost SITC. CNOOC may benefit from...