In today’s briefing:
- A/H Premium Tracker (To 21 Jun 2024): AH Premia Stabilising Lower, Can Move A Leg Lower Still
- HK Connect SOUTHBOUND Flows (To 21 June 2024); Every Day A Net Buy; Banks, Energy, and Utes
A/H Premium Tracker (To 21 Jun 2024): AH Premia Stabilising Lower, Can Move A Leg Lower Still
- The New/Better A-H Premium Tracker has tables, charts, measures galore to track A/H premium positioning, southbound and northbound positioning/volatility in pairs over time, etc.
- BIG Net SOUTHBOUND inflow continues. Notable in the past four weeks are US$1.9bn of net flow to Energy Hs and US$2.2bn to Banks in the H side of H/A Pairs.
- AH Premia lowish in 52-week range, but still high for many pairs. I continue to expect further “convergence” among spreads, and the recent HA Premium bounce has lost momentum.
HK Connect SOUTHBOUND Flows (To 21 June 2024); Every Day A Net Buy; Banks, Energy, and Utes
- SOUTHBOUND was again a net buyer, for HK$24.1bn this week, on smallish two-way volumes. Banks, Tech, Energy, and Materials all saw inflows.
- It is not clear how much of this is H/A discounts, expected dividend tax removal, shareholder return KPIs for SOE CEOs, upcoming Third Plenum policy, or national team buying…
- But valuations are acceptable. Flows are good. Policy changes are afoot. SOUTHBOUND may continue to see inflows – national team and otherwise.
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