Modest Gains In Final Session Of ’23, CSI 300 Falls For Third Straight Year

MNI (London) - The CSI 300 added 0.5% during the final session of ’23, while the Hang Seng was little changed on the day. Still, the mainland benchmark shed a little over 11% in ’23 as it registered a third consecutive annual decline.

• Note that both the Shanghai & Shenzhen exchanges will cut some services fees for listed firms in ’24.
• At least 13 names have withdrawn IPO applications over the past week.
• Net mainland flows via the HK-China Stock Connect scheme were essentially neutral on the day (with a marginal negative tilt), after two days of notable net inflows (which totalled a little over CNY19bn).
• ’23 saw the lowest round of net annual purchases of mainland equities via the Stock Connect links since at least ’17.
• Apple partner Luxshare Precision benefitted from news that it will gain control of an iPhone assembly site.
• Fireworks-related names benefited from speculation re: the revision to a banning order for a second straight day.
• Medical names benefitted from warnings re: a rise in Chinese COVID cases.
• Air carriers struggled after Morgan Stanley marked down net income estimates for the space.
• Shipbuilders benefitted from medium- to long-term green guidance from Beijing for the sector,
• A quick reminder that talk of China being “cheap,” in a relative sense, has picked up in recent weeks. However, this year’s showing and an elongated period of such “cheapness” has resulted in more guarded calls this time around. Long China plays were one of the favoured calls heading into ’23, with economic hope surrounding the abolition of ZCS at the fore. The development of well-defined risks re: debt levels and the broader property sector blunted that hope, along with inconsistent economic performance.