In today’s briefing:
- MSCI May 2022 Index Rebalance Preview: Changes in a Volatile Market
- Hong Kong: Where Have Shorts Increased & Decreased?
- SPH Releases EGM/Scheme “Substantial & Relevant Questions” – Beware Chain Offer Comments
- Tencent (700 HK): Layoff and Penalty Before 4Q21 Result
- Korea Holding Companies: Stub Tradable Names
MSCI May 2022 Index Rebalance Preview: Changes in a Volatile Market
- The review period runs from 18-29 April for the May SAIR, the results will be announced on 13 May (Asia-time) with the changes implemented after the close on 31 May.
- Most of the potential changes are in China with few changes spread across the other Asian markets. China loses the most number of index members, followed by Japan.
- There are over 4 weeks to the start of the review period and there will be changes over that time as stock prices move around.
Hong Kong: Where Have Shorts Increased & Decreased?
- Short notional in Hong Kong is HK$488bn and has been falling mainly as a result of a falling market. Short interest has increased substantially from end January.
- From 31 January to 4 March, the largest shorts have been built on Tencent, China Merchants Bank, AIA Group Ltd, Alibaba, JD.com, Meituan, Xiaomi, JD Health and Xinyi Solar.
- Over the same period, shorts have covered on COSCO Shipping Holdings, HKEX, Longfor Properties, China Construction Bank, Ping An Insurance, Yanzhou Coal Mining Company and HSBC Holdings.
SPH Releases EGM/Scheme “Substantial & Relevant Questions” – Beware Chain Offer Comments
- Singapore Press Holdings (SPH SP) has released a set of Q&A for holders as we approach the 22 March EGM/Scheme Meeting.
- Approval of both resolutions/votes is necessary to effect the Cuscaden Peak deal.
- The comments and answer about the SPH REIT Chain Offer may be misleading. Take care of the details!
Tencent (700 HK): Layoff and Penalty Before 4Q21 Result
- Layoff rumors are spreading, which shadow two departments and 10% of Tencent’s employees.
- China Banking Regulatory Commission (CBRC) will fine Tencent for money laundering.
- Short video apps are taking time on site from Tencent’s WeChat app.
Korea Holding Companies: Stub Tradable Names
- Korea has a total of 68 holding companies listed on KOSPI and KOSDAQ. We then have 14 holdcos with a high level of price cointegration with their respective listed subsidiaries.
- Three holding companies have sigma below zero on a 20D MA. Hanwha Corp is considered stub tradable as its share price relative to its subsidiaries was relatively flat.
- Four holdcos, including SK Square are over 70% NAV discount. Among them, SK Square is of the most interest as the price correlation with SK Hynix has been improving lately.
Before it’s here, it’s on Smartkarma
