Markets Longing for the Fed to Continue to Buy Bonds

Funds expect the Fed to announce more guidelines on its bond purchase plan after the interest rate meeting tonight, such as focusing more on buying forward bonds, lowering the long-term bond interest rate in disguise, the global stock market is the first to rebound, and the HSI is also hitting 26,200 points After rebounding from the technical barrier, it closed at 26460 points today, up 253 points or 1%. If the market interprets the message released by the Federal Reserve tonight positively, it does not rule out that Hong Kong stocks can rise again. However, SMIC (00981), which was hotly speculated earlier, was dragged down by the haze of high-level personnel changes and resumed trading in the afternoon, which fell nearly 5%. Investors should pay attention to related fluctuations in the short term.

Pfizer Vaccine and BioNTech and Fosun Pharma have reached an agreement to supply at least 100 million doses of COVID-19 vaccine to the mainland next year.

According to CNBC, the Fed may see a brighter long-term outlook when it releases its economic forecasts Wednesday due to vaccine developments, but it also has the opportunity to disappoint at least some investors who are expecting immediate changes in its bond buying program.

The market has been divided about whether the Fed would extend the duration of its $80 billion Treasury purchases, meaning increase the purchases at the long end, like the 10-year note and 30-year bond. Theoretically, that should help keep down the longer term rates that impact mortgages and other loans.

As the economy recovers in earnest thanks to the spread of the Corona 19 vaccine, it is predicted that the S&P 500 index will rise to the 4300 level next year.

According to CNBC in the United States on the 15th (local time), investment company Oppenheimer proposed next year’s S&P 500 index target at 4300 points. Considering that the S&P500 ended at 3694.62 on this day, it is believed that there is an additional upside potential of about 16%.

“Of course, this prediction presupposes the successful distribution of the COVID-19 vaccine and more support from the US Central Bank (Fed),” said John Stoltzpus Oppenheimer’s chief strategist (photo). “The Fed’s monetary policy and the administration’s fiscal policy next year We expect to boost the US economy by the first quarter.”

Oppenheimer said the federal senator (two-seat) final ballot scheduled for next January in Georgia could also have an impact on market trends. If the Republican Party wins this election, it can give it a slight edge in Congress and prevent the Democratic-led tax hike.

By industry, the company ordered a “expansion” of information technology (IT), free (non-essential) consumer goods, industry and finance. Energy, utilities, and real estate were assigned a “reduced weight”.

On the same day, Wells Fargo, an investment bank (IB), proposed the S&P 500 index target of 3800 to 4000 points for next year. Darrell Cronk, Chief Investment Officer of Wells Fargo, predicted, “The improvement of the economic situation next year will lead to increased corporate and consumer confidence, which will drive corporate profit growth.”

CNBC added, “However, this outlook by Wells Fargo is somewhat conservative compared to the fact that 12 out of 20 market strategists suggested the 4,000~4000 line as the S&P500 target next year in a recent survey.”

Wells Fargo predicts that the earnings per share (EPS) of the companies that make up the S&P500 index will increase by more than 30% from $130 this year to $175 next year.

At the same time, he advised customers to “invest mainly in’high quality companies’ next year.” Here, a high-quality company means a company with stable profitability and low financial leverage (liability) ratio.

Wells Fargo, like Oppenheimer, recommended investments in IT, consumer free goods, healthcare, and telecommunications services. Reflecting the weak US dollar, improving fundamentals, and the possibility of expanding infrastructure investment, we raised the view on the raw materials industry to be “friendly”.

Reporter Oh Hyeong-joo ohj@hankyung.com

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[13:29] SMIC (00981)’s decline narrowed to more than 4%, reported 20.25 yuan, the afternoon trading once again fell 10%, as low as 19.2 yuan.

[13:05] Hong Kong stocks rose about 215 points in the early afternoon to report 26,424 points.

[13:00] SMIC (00981) resumed trading in the afternoon and fell 8% to a low of 19.2 yuan.

[12:42] The Hang Seng Index rose 234 points to 26,435 points.

[12:00] The Hang Seng Index closed at 26,422 points at noon, up 215 points. Tencent (00700) and Alibaba (09988) rose more than 1%; Xiaomi (01810) bucked the market and fell 2%; Blue Moon (06993) first listed, 16% higher than its IPO price.

[11:48] The Hang Seng Index rose about 210 points to 26420 points before the market closed at noon.

[11:30] The mainland stock market developed individually in half a day. The Shanghai Stock Exchange rose nearly 0.2%; the Shenzhen Stock Exchange fell nearly 1%; the ChiNext index fell nearly 0.3%.

[11:22] IPO Blue Moon (06993) rose more than 17% to 15.5 yuan.

[11:11] Hong Kong stocks expanded to nearly 300 points, reporting 26502 points, up 295 points.

[10:42] Hong Kong stocks expanded to more than 200 points, and the Hang Seng Index rose 228 points to 26,435 points.

[10:34] Film stocks rose, Ali Pictures (01060) rose 6%; IMAX China (01970) rose more than 2%. The Lighthouse Research Institute and Poison Eye released the “2020 Chinese Film Market User Report” and predicted that the annual box office will reach 20 billion yuan.

[10:27] Jingdong (09618) rose by 3%, reaching a high of 316 yuan.

[10:24] Alibaba (09988) rose 2%; Meituan (03690) rose more than 1%; Tencent (00700) rose nearly 0.4%; as for Xiaomi (01810), it fell nearly 1.7%.

[10:18] Tianneng Power (00819) rose more than 14% to reach 17.12 yuan. Tianneng Power was approved by the China Securities Regulatory Commission for its spin-off battery business to be listed on the Science and Technology Innovation Board last day.

[Transferred stocks] Tianneng Power soars 15%   plans to spin off battery business to be listed on the Science and Technology Innovation Board

[10:11] BYD Electronics (00285) rose by half to reach 41.6 yuan.

[10:04] Meituan (03690) turned up to 275.2 yuan, up nearly 0.4%.

[09:58] Xiaomi’s (01810) share price bucked the market downward, and the decline expanded to 2%, reaching as low as 28.8 yuan.

[09:53] Tianli Education (01773) fell more than 7% to as low as 7.63 yuan. Tianli Education allots shares with the old-for-new method, placing 91 million shares at a price of 7.72 yuan per share, a discount of approximately 11.97%.

[Allotment tide] Tianli Education raises up to 690 million yuan through discount allotment

[09:50] HSBC (00005) stock price rose 1.7% to reach a high of 41.95 yuan. Nicholas Watt, the political editor of the BBC, posted on social media that the UK is about to reach a post-Brexit trade agreement with the European Union.

[HSBC HSBC stock price] Eurobank plans to spend 940 million yuan to acquire HSBC’s Greek business, the market opened this morning and rose more than 1%

[Brexit] BBC editor: Britain and the EU are close to reaching a trade agreement. The pound to Hong Kong dollar sees 10.4

[09:47] GCL-Poly (03800) continued to rise by 10%, breaking the top to reach 1.42 yuan.

[09:45] Hong Kong stocks rose about 155 points in the early session, and the Hang Seng Index reported 26,362 points, up 154 ​​points.

[09:43] Blue Moon (06993) expanded to 22%, reaching as high as 16.5 yuan.

[New Stock IPO] Blue Moon 6993 listed on the first day, rose more than 20%, market value exceeded 90 billion yuan

[09:37] ATMX generally bucked the market downward. Tencent (00700) fell nearly 0.1%; Meituan (03690) fell 0.4%; Xiaomi (01810) fell 0.5%; Alibaba (09988) rose nearly 1%.

[09:35] Auto stocks rose, of which China Long Automobile (02333) rose more than 2% to break the top; BYD (01211) and Brilliance (01114) rose more than 1%; Geely (00175) rose nearly 0.9%.

[09:33] Apple (US: AAPL) share price rose overnight, Sunny (02382) rose more than 2%; AAC (02018) rose nearly 2%. Gaowei Electronics (01415) rose 0.5%; Qiu Ti (01478) rose more than 10%.

[09:30] Qiu Ti (01478) rose nearly 10% to 12.12 yuan. Qiu Ti Technology announced that it is considering the possible spin-off of Qi’s wholly-owned subsidiary, Xia Kunshan Qiu Ti Microelectronics Technology Co., Ltd., and independently listed on the Shenzhen Stock Exchange or the Shanghai Stock Exchange.

Qiu Ti Technology intends to split the lens business subsidiary “Kunshan Qiu Ti China” and list on A shares

[09:27] Xinyi Solar (00968) broke the top 10% and opened at 15.7 yuan.

[09:20] The Hang Seng Index opened at 26421 points, up 213 points. Alibaba (09988) and Xiaomi (01810) rose more than 1%, and Blue Moon (06993) first listed and opened 16% higher.

[09:14] The spot-month index futures opened at 26352 points, up 114 points or 0.4%, 145 points higher.

[09:05] SMIC (00981) halted trading before the market opened.

[SMIC] SMIC suspends trading before the market opens, Liang Mengsong intends to resign as co-CEO

[SMIC] Who has made great contributions to TSMC and Samsung?

[09:02] The People’s Bank of China launched a RMB 10 billion reverse repurchase operation. As the RMB 20 billion reverse repurchase expired today, a net return of RMB 10 billion was realized on that day.

[08:55] Blue Moon (06993) was listed today. Yesterday, the dark market performed better on the Futu dark market. Blue Moon closed at 15.98 yuan, 21.4% higher than Blue Moon’s IPO price of 13.16 yuan, and one lot (500 shares) book value Earn 1410 yuan.

[New Stock IPO] Blue Moon 6993 dark market closed up about 20%   one hand book made thousands of dollars

[New Stock IPO] Blue Moon 6993 Chasing and Selling Raiders   the dark market rose by nearly 20%, brokerages expected to rise by about 10% to 30%

[08:44] The Hang Seng Index rose 158 points to 26359 points in the black future; Dow futures fell 38 points to 30076 points.

[08:20] In response to the previous administrative order issued by the United States, MSCI will remove the stocks of 10 Chinese companies after the market closes on January 5, 2021, including China Communications Construction (01800), Hikvision, CRRC (01766) ) Wait.

[U.S. Sanctions] MSCI will remove 10 Chinese stocks including China Communications Construction and CRRC, which will take effect on January 5 next month

[08:00] Sino-Ocean Group (03377) spin-off Sino-Ocean Services (06677) is priced at 5.88 yuan per share, oversubscribed by 7.91 times, and the first lot rate is 15%.

[New Stock IPO] Sino-Ocean Services 6677 oversubscribed nearly 8 times and the first-hand lottery rate was 15% (with distribution results)

[07:45] Yunxiang Technology Netjoy (02131) is priced at 6.98 yuan per share, oversubscribed by 113.45 times, and the first lot rate is 10%.

[New Stock IPO] Cloud Thinking Technology 21,131, nearly 160,000 people subscribed, overbuying 113, the first lottery rate of 10% (with distribution results)

[07:45] HSBC (00005) ADR was reported at 41.77 yuan, up 0

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