Market review:

China stocks stayed firm with SHA climbed about 0.26% after a quite volatile trading day.

Research Notes:

Money flowed into Non-Ferrous Metal Mining, Coal and Telecommunication Equipment sectors the most, boosted by the heat of commodity market. Hubei Shuanghuan Science and Technology Stock Co.(000707.sz), a sodium producer, rallied to limit-up as price of sodium rose, following the trend of other chemicals, which suffered from pressure to cut production as environment protection regulation tightened.

DXY rebounded to 97.6 as US presidential election kicked off this week, and investors added some risk premium back to the currency. CNYUSD fell to 6.77 again as investors getting ready for several important China macro data this week, including CPI, PPI and Trade balance. In commodity market, coal, coke and rebar hit limit-up as NDRC failed to curb the rally as it can’t maintain the environment and supply targets at the same time. We belied the rally could rally further until the NDRC figures out a solution to reach a balance. And other commodity also getting firmer with demand increased in winter. As fuel sector and environment sectors, as well as those new energy stocks, in spot light, we recommend investors to own more shares from these two sectors and as US election still in progress, index futures should be used to hedge the downside, at least for the following week.