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Market review: April 22, 2016

Fang submitted 2016-04-22 15:31:05

Market review:

China stocks generally stabilized as gov tried to curb the commodity rally which drew funds from equity market.

Research Notes:

Money flowed into Power Generation, Household Electronics and Printing sectors the most.Lanzhou Yellow River Corp (000929.sz), a beer producer, rallied to limit-up for its plan to merge with Xinyuan Group, a real estate developer.

As all three commodity futures exchange in China placed higher margin requirements and more strict position limit on the recent overheated commodity market, we felt that some money would retreat from commodity market and flow back into equity market, though the curb would also hurt risk appetite in both markets. As Fed meeting approaching at the end of month, the drop of SHA may present some buying opportunity, but we, for now, considered to grab the dip only after the Fed meeting or when SHA fell below 2900.

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