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Market review: October 25, 2016

Fang submitted 2016-10-26 19:54:17

Market review:
China stocks stayed stable as investors taking some profit after two days of rally.

Research Notes:
SHA climbed about 0.12% with money flowed into Wine Brewing, Non-Ferrous Metal Mining and Chain Store the most. Inner Mongolia PingZhuang Energy Resources Co.(000780.sz),a coal miner, rallied to limit-up as its profit for Q3 turned positive as price of coal rallied for months.
Futures price for coal and coke also made new high since the being listed in the exchanges in China. DXY climbed toward 99 and CNYUSD made a new low in the past 6 years for strong expectation for the target around 7 as gov saved ammunition and referred to a currency basket that showed CNY’s actually appreciated against a basket of non-USD currencies. In commodity market, coal, manganese alloy and iron ore rallied to limit-up, as the short squeeze continued for another day and CSRC failed to curb the overheating of the coal complex. The overall commodity sector remained strong as Yuan weakened against the USD. The recent rally of SHA brought some relief to the investment industry, yet investors should, in our opinion, gradually take some profit out of the rebound, when the communist conference which ended on 27th when the reform plan would be published. Yet we still favor the new energy and environment protection sector as well as the whole energy sector which would benefit from the winter.

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