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Market review: July 18, 2016

Fang submitted 2016-07-18 15:12:10

Market review:

China stocks declined with SHA fell about 0.35%.


Research Notes:

Money outflowed from Finance Brokerage, Construction and Software sectors the most. Shanghai Challenge Textile Co. (002486.sz), a producer of functional fabrics for outdoor apparels, rallied to limit-up as investors speculated the management would increase the shareholdings after a fund freed up a proportion of stocks of the firm.

After the relatively better than expected GDP release last Friday, CNYUSD resumed the falling as investors believed PBOC would increase some monetary easing effort for Q3 and pressured the value of RMB further, which affect the sentiment of equity investors less than it used to. In commodity market, rebar and iron ore futures fell to the limit-down level after June Housing Sale data showed the price appreciation slowed down. For soybean and rapeseed meals, the mild weather in US Midwest push the price lower with expectation for better soybean yields. Though we maintained our expectation for SHA to rally into Aug, it’s reasonable cut some risk exposure around SHA 3050 threshold, and investors can rotate some fund into Sport, Entertainment and Gaming sectors as the Brazil Olympics Games about to start.



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