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Market review: February 16, 2017

Fang submitted 2017-02-16 23:31:42


China stocks declined Friday after the relax of some index futures trading regulations. SHA fell about 0.85%, the biggest decline since year 2017, with money outflowed from Construction, Finance and Petrochemical sectors. Seems investors didn’t recognize the index futures relaxation as a bullish factor, at least for the short term. Zhuhai Habor (000507) rallied to limit-up as the company will benefit from the one belt one road policy. Overnight strong US econ data boosted the DXY and held it up to 100.66 level yet CNYUSD generally stated firm as the money tightness persists in inter-bank market, with Shibor rates climbing. In commodity market, rebar, silicon manganese and coal led the rally, supported by supply-curb as warming season over. Yet majority commodities fell as the liquidity tightness damped the risk appetite. Despite the recent selling off we maintained our bullish view on SHA with favor over One Belt One Road, International Trade and medicine sectors, as the people’s congress may offer supporting policy in March. Investors can increase some positions when SHA dips under 3180 level with mid term target 3300 ~3350 for Q1.


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