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Market review: June 20, 2016

Fang submitted 2016-06-20 15:31:05

Market review:

China stocks continued to rebound as risk of Brexit fading.

Research Notes:

Money flowed into Electronics, Construction Materials and Medicine sectors the most. ABA Chem (300261.sz), an medicine and pesticide producer, rallied to limit-up as the recent flood and rainy weather increase the demand for its products.

CNYUSD seems stayed firm at 6.58 level with USD showed further weakness when investors are waiting for Yellen testify in Congress Tuesday and Wednesday this week, which is mostly considered as dovish. The weakness of USD also supported commodity prices with rubber and plastics, rose about 4%, led the rally. Even we speculated that the risk of Brexit is low and generally will not affect China market very much, it’s still wise to keep the risk exposure limited in case of a black swan event. The low volatility also showed that most investors indeed stayed conservative before the vote.

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