Linn's China Gate Stocks

CHINAGATE -- INTRODUCTION

SEE STORY BELOW ON "GOOD POLICY -- PICKING CHINA STOCKS"

  

   

Venerable magazine editor Bob Flaherty once admonished me to write about China stocks as if I were writing for “the typical investor in Akron” – that is, explain this exotic subject to an astute non-expert clearly, step-by-step.

  

 

Well…

  

 

 Hello

Akron.

 

 

This blog will help the average investor take advantage of fast-growing  China-related stocks and avoid as much as possible the market’s daunting volatility. No, I won’t be recommending “secret” stock picks guaranteed to leap 60% or so in a few months. Nothing personal, but if I could regularly finds such gems, I wouldn’t tell you.

 

Instead I will help investors understand both basic workings of markets for China-related stocks and hot trends and topics that move stock prices. Here are the blog’s main features:

  

 

Daily stock market report from Hong Kong , the primary gateway to China stocks for foreigners, with the latest figures, a brief summary and recent quotes from analysts to provide context. See the most recent report below.

 

 

 

 

Weekly report from Hong Kong, posted every Friday morning, U.S. time. Also see below.

 

 

 

 

Daily fix. The right column on this page provides links to the latest movements on markets listing stocks related to China. Under these links are gateways to expert analysis, from short, medium and long-range perspectives.

 

Scorecard. China-related stocks can seem like a large helping of confusing alphabet soup – H, B, A shares and more. ChinaGate sorts them all out and illuminates the pros and cons of each market. See the page in the column on the right.

 

 

 

 

 

Featured story. I’ll regularly write stories focusing on one of the current market moving topics. The start of the latest story is posted below. Previous stories are on pages in the column to the right

  

Different Strokes. You can buy and sell them like any other stock (well, more or less), but China-related stocks are different. Click on the Different Strokes page in the column on the right for an overview of what you need to know before diving into this brave new world.

 

 

Your questions. You don’t have to be from Akron to ask questions and make comments.

 

 

PLEASE SEE WWW.EQUITIES.COM FOR STOCKS REPORT

OCTOBER 12, 2011 -- CHINA MARKETS BOOST HONG KONG

DAILY FIX
 
Hong Kong Blue Chips: +188, +1.0%, to 18,329, 10-12-11, Hang Seng Index

Chinese Stocks in Hong Kong: +198, +2.1% to 9,456, 10-12-11, HSCE Index

Shanghai Stocks: +3.0%, 2,420, 10-12-11, Shanghai Composite Index.

Chinese Stocks in the U.S.: +0.02, to 363.0, 10-11-11, Bank of New York Mellon, ADR Index-China

Insight: A strong rise in Chinese stock markets carried Hong Kong higher, extending its recent rally in moderately active trading. KGI Research

Quotable: "...the overall market sentiment was relatively strong. Particularly, 9-day RSI had already climbed back above 50 and the overall market turnover was relatively high to show the strength of the market. It might help the market to have better performance in short term." Core Pacific Yamaichi. 10-12-11

Chinese Companies to Watch: "Valuations of A-share and H-share banks have hit their historical low and deliver excellent mid-to long-term investment appeal, with H-share banks trading at only 5.42x P/E and 1.05x P/B on average. We maintain “Outperform” for the sector and recommend CCB (CICHY, 0939), MSB (CMAKY, 1988), CITIC Bank (CHCJY, 998)...." BOCOM International. 10-11-11

Brokerages and analysts cited have disclaimers on their websites emphasizing their statements are for information only. They do not endorse my blog, and I don't endorse them.
For a list of Chinese companies sold in the U.S. and information on each company go to http://www.adrbnymellon.com/dr_country_profile.jsp?country=CN

OCTOBER 10, 2011 -- EARLY GAINS ERODE IN HONG KONG

DAILY FIX
 
Hong Kong Blue Chips: +4, +0.02%, to 17,711, 10-10-11, Hang Seng Index

Chinese Stocks in Hong Kong: -18, -0.2% to 8,870, 10-10-11, HSCE Index

Shanghai Stocks: -0.6%, 2,345, 10-10-11, Shanghai Composite Index.

Chinese Stocks in the U.S.: -10.8,to 350.3, 10-07-11, Bank of New York Mellon, ADR Index-China

Insight: China stocks opened higher in Hong Kong due to optimism Europe would recapitize its struggling banks, but a drop on Mainland markets cut into gains. Reduced turnover included heavy trading in warrants, which reflects strong speculative interest. The Chinese government investment arm, Huijin, bought A shares in the four major Chinese banks,leading to a late rebound for these banks in Hong Kong.BOC (HK) (PINK BHKLY) rose 2.1%. The parent company's ADR code is BACHY. KGI Research

Quotable: "All in all, Hong Kong stock market may be choppy next week, and the HSI may test 18,000 points with its support level likely residing at 16,500 points." BEA Securities. 10-7-11

Chinese Company to Watch: YANZHOU COAL (YZC;1171) "Thanks to further acquisition concept, we expect overseas business to account for near 30% of FY12 earnings. Prospective P/E of 7x." KGI Asia. 10-7-11

Brokerages and analysts cited have disclaimers on their websites emphasizing their statements are for information only. They do not endorse my blog, and I don't endorse them.
For a list of Chinese companies sold in the U.S. and information on each company go to http://www.adrbnymellon.com/dr_country_profile.jsp?country=CN

OCTOBER 7, 2011 -- FOLLOWING U.S., EUROPE HIGHER

DAILY FIX
 
Hong Kong Blue Chips: +535, +3.1%, to 17,707, 10-07-11, Hang Seng Index

Chinese Stocks in Hong Kong: +316, +3.7% to 8,888, 10-07-11, HSCE Index

Shanghai Stocks: Closed for holiday 2,359, 10-07-11, Shanghai Composite Index.

Chinese Stocks in the U.S.: +8.3 to 361.0, 10-06-11, Bank of New York Mellon, ADR Index-China

Insight: Hong Kong rallied in tandem with U.S. and European markets as fears subsided, at least temporarily, concerning European debt and the U.S. economy. Major China port operator Hutchison Whampoa (PINK HUWHY; 0013 in Hong Kong) jumped 10.5% after reporting that its stock price was at a discount of nearly 50% to its net asset value. KGI Research

Quotable: "We expect the improved sentiment would last for a while longer." BOCOM International. 10-7-11

Chinese Company to Watch: Alibaba, e-commerce provider (OTC ALBY; 1688) "If the Company succeeds in acquiring Yahoo!, the scope and scale of the Company’s business will further expand. Alibaba’s current share price is relatively attractive, we believe that the acquisition rumor will serve as a catalyst for its stock price and therefore advise a bargain hunt for Alibaba." CFSG. 10-6-11

Brokerages and analysts cited have disclaimers on their websites emphasizing their statements are for information only. They do not endorse my blog, and I don't endorse them.
For a list of Chinese companies sold in the U.S. and information on each company go to http://www.adrbnymellon.com/dr_country_profile.jsp?country=CN

OCTOBER 4, 2011 -- LOOMING GREEK DEFAULT ROILS MARKET

DAILY FIX
 
Hong Kong Blue Chips: -572, -3.4%, to 16,250, 10-04-11, Hang Seng Index

Chinese Stocks in Hong Kong: -306, -3.6% to 8,102, 10-04-11, HSCE Index

Shanghai Stocks: Closed for holiday 2,359, 10-04-11, Shanghai Composite Index.

Chinese Stocks in the U.S.: -11.1 to 338.8, 10-03-11, Bank of New York Mellon, ADR Index-China

Insight: The prospect of a default by Greece and of slower Chinese economic growth again forced prices down sharply in Hong Kong. Mainland banks continued to slide: CCB (CICHY OTC; 0939 in Hong Kong) fell more than 3%. One gainer was Smartone (PINK STTFY; 0315) which rose 5.3% on talk Apple would soon launch iPhone5. KGI Research

Quotable: "Hong Kong market will continue to fall in Q4, thus investors should stay cautious and avoid heavy operation." CFSG. 9-30-2011

Chinese Company to Watch: Sinopec. "According to our earnings estimate, the counter is presently trading at undemanding 2011 PER of 7.1x representing a deep discount to the sector average of 9x. We see limited downside risk on share price." Guoco Capital. 10-3-2011

Brokerages and analysts cited have disclaimers on their websites emphasizing their statements are for information only. They do not endorse my blog, and I don't endorse them.
For a list of Chinese companies sold in the U.S. and information on each company go to http://www.adrbnymellon.com/dr_country_profile.jsp?country=CN

OCTOBER 3, 2011 -- CHINA BANKS LEAD HONG KONG LOWER

DAILY FIX
 
Hong Kong Blue Chips: -771, -4.4%, to 16,822, 10-03-11, Hang Seng Index

Chinese Stocks in Hong Kong: -509, -5.7% to 8,917, 10-03-11, HSCE Index

Shanghai Stocks: Closed for holiday 2,359, 10-03-11, Shanghai Composite Index.

Chinese Stocks in the U.S.: -9.4 to 349.9, 09-30-11, Bank of New York Mellon, ADR Index-China

Insight: A sharp drop on Wall Street Friday and growing worries over bad loans at Chinese banks helped trigger a sell-off of China stocks in Hong Kong. Chinese financials were hit hard: ABC (ACGBY) -8.1%. KGI Research

Quotable: "For the coming week, investors will pay attention to the release of key US economic data, including retail sales on Monday, ISM Non-Mfg Index on Wednesday and unemployment rate on Friday. Nevertheless, the equity market is unlikely to see a significant rebound in the short-term, as the overall sentiment remains weak and nobody is willing to buy stocks at this moment. We see the HSI may test the next support level of 17,000." BEA Securities. 9-30-11

Chinese Company to Watch: "Lenovo agreed to form a joint venture with Compal Electronics (2324 TT) to make notebook computers in China, an unusual tie-up between a major brand and a contract manufacturers. Lenovo hopes it will help move up its global PC ranks." BEA Securities. 9-30-11

Brokerages and analysts cited have disclaimers on their websites emphasizing their statements are for information only. They do not endorse my blog, and I don't endorse them.
For a list of Chinese companies sold in the U.S. and information on each company go to http://www.adrbnymellon.com/dr_country_profile.jsp?country=CN

SEPTEMBER 30, 2011 -- CHINESE BANKS DRAG DOWN HONG KONG

DAILY FIX
 
Hong Kong Blue Chips: -419, -2.3%, to 17,592, 09-30-11, Hang Seng Index

Chinese Stocks in Hong Kong: -360, -3.9% to 8,917, 09-30-11, HSCE Index

Shanghai Stocks: -0.3%, 2,359, 09-30-11, Shanghai Composite Index.

Chinese Stocks in the U.S.: -1.8 to 359.4, 09-29-11, Bank of New York Mellon, ADR Index-China

Insight: Hong Kong blue chips opened 65 points lower and continued to fall, dragged down by big declines in Chinese bank stocks. Worry about declining asset values hit big banks like the Agricultural Bank of China (OTC ACGBY, 1288 in Hong Kong), which plunged 8.5%. KGI Research

Quotable: "Short-selling turnover for the market increased again. Total amount was up 32% to HK$9.55bn. Blue-chips short-selling turnover was up 48% to HK$6.37bn. The short-selling turnover ratios for these two groups were 13% and 22%, respectively. It reflected the sentiment that the market would retreat again in the near term." Core Pacific Yamaichi. 9-30-11

Chinese Company to Watch: "The giant banks such as ICBC (IDCBY;1398 HK), CCB (CICHY; 939.HK), BOC (BACHY; 3988.HK) plunged 3.81%, 2.31% and 3.02%, respectively. It means investor confidence in the financial sector has not been restored." Haitong Securities. 9-30-11

Brokerages and analysts cited have disclaimers on their websites emphasizing their statements are for information only. They do not endorse my blog, and I don't endorse them.
For a list of Chinese companies sold in the U.S. and information on each company go to http://www.adrbnymellon.com/dr_country_profile.jsp?country=CN

SEPTEMBER 28, 2011 -- HONG KONG DOWN AFTER BIG GAIN

DAILY FIX
 
Hong Kong Blue Chips: -119, -0.7%, to 18,011, 09-28-11, Hang Seng Index

Chinese Stocks in Hong Kong: -17, -0.2% to 9,277, 09-28-11, HSCE Index

Shanghai Stocks: -1.0%, 2,392, 09-28-11, Shanghai Composite Index.

Chinese Stocks in the U.S.: +2.6 to 361.3, 09-27-11, Bank of New York Mellon, ADR Index-China

Insight: Hong Kong opened lower after Tuesday's sharp rise and retreated further in the early afternoon in line with a drop in Asian and Mainland Chinese markets but gained back some losses before closing. Higher commodity prices helped Chinese resources plays. Oil producer CNOOC (NYSE CEO, 0883 in Hong Kong) gained 3.9%. Cement producers and construction companies continued to rebound: CNBM (OTC CBUMY, 3323) +3.4%.   KGI Research

Quotable: "Market rebound may continue but confidence remains weak." BOCOM International. 9-27-11

Chinese Company to Watch: China properties. "Considering current market volatility, we suggest sticking to index composite stocks with high market liquidity and with developers with healthy balance sheets. According to this criteria, we recommend CR Land (1109...." CCB Internatonal. 9-26-11

Brokerages and analysts cited have disclaimers on their websites emphasizing their statements are for information only. They do not endorse my blog, and I don't endorse them.
For a list of Chinese companies sold in the U.S. and information on each company go to http://www.adrbnymellon.com/dr_country_profile.jsp?country=CN

SEPTEMBER 27, 2011 -- OVERSOLD HONG KONG STOCKS REBOUND

DAILY FIX
 
Hong Kong Blue Chips: +723, +4.2%, to 18,131, 09-27-11, Hang Seng Index

Chinese Stocks in Hong Kong: +559, +6.4% to 9,292, 09-27-11, HSCE Index

Shanghai Stocks: +0.9%, 2,415, 09-27-11, Shanghai Composite Index.

Chinese Stocks in the U.S.: +2.6 to 361.3, 09-26-11, Bank of New York Mellon, ADR Index-China

Insight: News that European authorities are devising a plan to shore up big banks threatened be the region's debt crisis helped ignite a strong rebound in the substantially oversold Hong Kong market. Ping An Insurance (OTC PNGAY;2318 in Hong Kong) rose 10.1% after the company said its capital status was healthy. Chinese banks made strong gains: CMB (OTC CIHKY; 3968) +10.4%.  KGI Research

Quotable: "HK market rebounded from trough at 16,999 (on Monday), showing investors believed that this level will be a strong support." Core Pacific Yamaichi. 9-26-2011

Chinese Company to Watch: "We believe the market’s general view of Shanghai Electric ((SE) as a power equipment manufacturer underestimates the company’s true value. With leading positions in multiple businesses (around 30%, 50% and 15% shares of China’s thermal, nuclear island and elevator markets), SE’s diversification places it at an unique position as a conglomerate to benefit from a number of growth opportunities while mitigating risks relating to temporary glitches in the new energy segment." Haitong Securities. 9-27-2011

Brokerages and analysts cited have disclaimers on their websites emphasizing their statements are for information only. They do not endorse my blog, and I don't endorse them.
For a list of Chinese companies sold in the U.S. and information on each company go to http://www.adrbnymellon.com/dr_country_profile.jsp?country=CN

SEPTEMBER 26, 2011 -- HONG KONG REBOUNDS FROM SUB-17,000

DAILY FIX
 
Hong Kong Blue Chips: -261, -1.8%, to 17,408, 09-26-11, Hang Seng Index

Chinese Stocks in Hong Kong: -298, -3.3% to 8,735, 09-26-11, HSCE Index

Shanghai Stocks: -1.6%, 2,393, 09-26-11, Shanghai Composite Index.

Chinese Stocks in the U.S.: +9.1 to 358.8, 09-23-2011, Bank of New York Mellon, ADR Index-China

Insight: Hong Kong opened flat but fell sharply in line with a drop in Asian markets. Blue chips sank below 17,000 in mid-afternoon but rebounded late in active trading. A drop in gold and other commodity prices hurt resources plays. Cement producers and construction companies posted big losses: CNBM (OTC CBUMY; 3323 in Hong Kong) -11.1%. KGI Research

Quotable: "For the coming week, the market will eye ... the vote by the German parliament on the European Financial Stability Facility on Sep 29. Weak tone is likely to persist next week, and the HSI may test 17,000 points." BEA Securities. 9-23-2011

Chinese Company to Watch: PCCW (PINK PCCWY, 8 in Hong Kong), Hong Kong telecom operator. "PCCW is currently trading at 11.5x 2011 PER, 5.2% dividend yield and 7.1x EV/EBITDA, which we consider is reasonable in view of its defensive nature amid the current uncertain environment." Guoco Capital. 9-23-2011

Brokerages and analysts cited have disclaimers on their websites emphasizing their statements are for information only. They do not endorse my blog, and I don't endorse them.
For a list of Chinese companies sold in the U.S. and information on each company go to http://www.adrbnymellon.com/dr_country_profile.jsp?country=CN