Daily Posts

Mainland Gains Led By Reopening, Renewables

Key News

Asian equities were mixed overnight as Mainland China and Indonesia outperformed. Hang Seng Tech lagged the broader Hang Seng Index in Hong Kong overnight as both were lower by -0.43% and -1.32%, respectively, on volumes that were lower than Friday’s. Shanghai, Shenzhen, and the STAR Board were all up +0.20%, +0.48%, and +0.29%, respectively on volumes that were slightly lower than Friday’s.

The reopening trade came back to life in Asia after Pfizer said that its covid-19 pill is nearly 90% effective at reducing deaths and hospitalizations for the most vulnerable. Beneficiaries of the news included Macau casinos as the Macau Index gained +6% and airlines as Air China gained +8.5% overnight.

Renewable energy and electric vehicle stocks were strong on the Mainland overnight as Eve Energy surged +15.88% after announcing an electric vehicle battery line and CATL, the world’s largest battery maker, gained +4.21% overnight.

Online education was in the news on Monday as Beijing released new rules for the industry, allowing online education companies to continue offering some services. K-9 education services are still required to be non-profit, but companies can offer a vocational school to adults for a profit. Beijing plans to issue new licenses for after-school tutoring. TAL Education was up +3% this morning in the US.

Alibaba hosted a cloud computing conference where executives discussed the many synergies between cloud and the company’s other business lines. They reported that Alibaba has expanded its presence in transportation, energy, and health care clouds. Alibaba Cloud, Tencent Cloud, and Baidu AI Cloud are the central players in China’s growing cloud computing industry. E-Commerce and search platforms are all working to diversify their businesses, but Baidu is perhaps the farthest along. Beyond cloud, E-Commerce players in China will likely pioneer the country’s “metaverse” industry, according to analysts.

Last Night’s Exchange Rates, Prices, & Yields

  • CNY/USD 6.39 versus 6.40 Friday
  • CNY/EUR 7.41 versus 7.38 Friday
  • Yield on 1-Day Government Bond 1.63% versus 1.64% Friday
  • Yield on 10-Year Government Bond 2.90% versus 2.89% Friday
  • Yield on 10-Year China Development Bank Bond 3.18% versus 3.17% Friday
  • Copper Price +0.84% today