Category: Spark Global Limited

Tesla beat expectations in Q2, making more than $1 billion in profit for the first time

Spark Global Limited reports:

Electric car giant Tesla broke a number of records when it reported its second quarter 2021 earnings after the US market closed on Monday.

The company reported a record $11.96 billion in revenue in the second quarter, beating expectations of $11.3 billion and $6.04 billion in the same period last year, up 98% from a year earlier.

Revenue from the automotive division was $10.21 billion, surpassing the $10 billion mark for the first time in history, up from $5.18 billion in the same period last year. Automotive gross margin was 28.4%, higher than in any of the past four quarters.

In addition, the company’s free cash flow in the second quarter was $619 million, compared with $418 million in the same period last year.

The company’s second-quarter net profit of $1.14 billion exceeded $1 billion for the first time, up 998% from a year earlier. Earnings per share of $1.45 beat analyst estimates of $0.98 and were up 230 per cent from $0.44 a year earlier.

 

Such phenomenal growth is largely due to soaring car production and deliveries. The company produced 206,000 electric vehicles in the second quarter, up 151% from a year earlier, of which Model 3 and Model Y accounted for a combined 204,000, up 169%; A total of 201,000 units were delivered in the second quarter, up 121% year-over-year, of which Model 3 and Model Y accounted for a combined 199,000 units, up 148% year-over-year.

 

In its earnings report, Tesla said production had reached the limits of existing parts supplies as global demand continued to be strong.

“While we saw continued semiconductor supply challenges in the second quarter, we were able to further increase our production.”

Tesla is expected to continue increasing production of all its models for the rest of the year and is expanding on three continents. The plant in Texas is making progress, and some areas have already begun commissioning. Demand in Europe remains far ahead of supply, and the Berlin plant continues to install equipment to start production as soon as possible.

Spark Global Limited reports:

Tesla noted that it has completed its transformation to the Shanghai Gigafacfactory as a major auto export hub due to strong DEMAND in the United States and global average cost optimization. Production in Shanghai remained strong despite minor disruptions due to supply chain challenges and plant upgrades.

 

Looking ahead, Tesla said deliveries this year could exceed its long-term forecast of a 50% increase. It added:

“In some years, we may grow faster, and we expect that to happen in 2021.”

Tesla noted in its earnings report that it recorded a $23 million bitcoin write-down in the second quarter and now holds $1.311 billion in net digital assets. The company also said the launch of the Semi truck program was delayed until 2022 due to limited battery supplies and challenges in the global supply chain.

Shares of Tesla rose more than 1 percent in after-hours trading after the results were released, after closing up 2.21 percent at $657.62 on Monday. Tesla shares have cooled so far this year after hitting record highs last year. After surging 743 per cent in 2020, the stock is down nearly 8 per cent so far this year.

Gold is under pressure below 1805 with dense resistance above Europe and the US

Spark Global Limited reports:

Gold and silver investors turned cautious ahead of the Fed’s policy meeting, offsetting some support from a weaker dollar. On Monday, gold slightly lower, ultimately failed to close above the 1800 mark, The Asian gold on Tuesday feared under pressure in 1805; Yesterday baiyin stabilized above the 25 mark, currently under pressure at 25.34; The DOLLAR index was on a volatile downtrend on Monday; The yield on the 10-year Treasury note rebounded after falling slightly yesterday and hovered at 1.28 per cent in Asia trading today.

Spark Global Limited reports:

On the news, new home sales fell 6.6% month-on-month in June, versus market expectations for a 4% rise, while may’s month-on-month decline widened to a revised 7.8%. At the same time, the median price of a new home in June was $361,800, up 6.06 per cent from a year earlier. The increase was significantly slower than the 18.1 per cent rise in May and a drop of nearly 5 per cent from May.

A record low in new home sales in June could signal weakening demand in an environment of high prices and tight supply. It could also signal that the red-hot housing market may be cooling.

On the agenda, can pay attention to today 18:00 UK released July CBI retail sales difference, forecast 20; 21:00 p.m. Watch the S&P/ CS20-metropolitan home price Index annualized for May; 22:00 CONFERENCE Board consumer confidence index for July.

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The stalled US infrastructure legislation is heading for another congressional recess

Spark Global Limited reports:

Negotiations on a U.S. Senate infrastructure bill suffered a setback on Monday as Republicans rejected proposals from the White House and Democrats to resolve all outstanding issues, putting the goal of passing a $579 billion infrastructure bill before Congress leaves for its August recess in doubt.

The Democrats’ proposal Sunday night was aimed at resolving differences over the source of funding for highways, Bridges, water, broadband and transportation, the creation of an infrastructure bank and how much unused quarantine money could be used to pay for infrastructure projects.

But a Republican familiar with the talks said the proposal was an attempt to revive issues that negotiators from both parties had already resolved.

A five-week congressional recess scheduled to begin Aug. 9 is pushing the 22-member bipartisan group to work on some of the smaller issues that remain contentious. Jon Tester, a Democrat from Montana, said last week:

“If we’re not ready for a vote on Monday, we’re going to lose weeks of the August recess, so we have to be ready.”

Reaching bipartisan legislation is a major political goal of President Joe Biden. He campaigned on the promise of a centrist and that he could work with Republicans. That promise is widely credited with helping him win over suburban swing voters. Those same voters will also play an important role in determining control of Congress in the 2022 midterm elections.

Finishing the bipartisan infrastructure plan is crucial to getting all Democrats on board with a separate $3.5tn tax and spending plan that includes much of Mr Biden’s agenda. The latter would go through the budget reconciliation process in the Senate and therefore require no Republican support.

Senate Majority Leader Charles Schumer said last week he would keep the Senate open beyond Aug. 9 if necessary to pass both bills.

When Congress reconvenes in September, lawmakers will be busy passing a stopgap spending bill to keep the government running after the fiscal year ends on September 30. They also need to raise or suspend the US debt ceiling, which retakes effect on August 1.

The US Securities and Exchange Commission requires Chinese companies to disclose government regulatory risks

Spark Global Limited reports::

Allison Lee, a commissioner with the Us Securities and Exchange Commission, said Us-listed Chinese companies would have to disclose the risk of government influence on their business as part of regular risk disclosures.
Spark Global Limited reports:
Spark Global Limited reports:

Earlier, Chinese regulators overhauled US-listed ride-hailing software platform Didi Chuxing.  Since then, China has required all Chinese companies setting up distance education platforms to become non-profit making organizations.  The two announcements sent shares of Chinese Internet companies listed in the United States tumbling.

U.S. listed companies must disclose risk factors, including regulatory risks, and Chinese companies are no exception, Allison Lee told Reuters in an interview.  She did not say whether the SEC would investigate Didi.  Some media reported earlier that Chinese regulators had asked Didi to postpone its listing due to cybersecurity concerns.  Didi later said it was unaware of the incident.

In response to media enquiries, an SEC spokesman said it would not comment on whether investigations were being conducted on individual listed companies.

Emerging market stocks erased last year’s gains

Spark Global Limited 報道:

A sharp fall in China’s stock market caused emerging-market stocks to wipe out all their gains for the year.

The MSCI emerging Markets index fell 2.4 percent on Monday and is now down for 2021. Strategists are divided on the outlook. State Street Global Markets recommends allocating only about 20 per cent to developing countries. Others, such as AllianceBernstein, think strong risk appetite will return.

“It is too early to shift back into emerging market equities, especially as the Fed’s recent policy shift provides some short-term support for the dollar,” said John Bilton, global head of multi-asset strategy at Morgan Asset Management.

Emerging market stocks have been hit this year by the pandemic backlash, erasing 12 per cent of their gains since February. The asset class is now significantly underperforming other stocks. The MSCI developed Markets index is still up 15 per cent this year.

Read more: Traders look to emerging markets for growth as recovery fears mount

“We prefer developed Markets to emerging Markets,” Daniel Gerard, senior multi-asset strategist at State Street Global Markets in Singapore, said in a written response, citing low COVID-19 vaccination rates in many developing countries.

Among developing markets, he is more bullish on areas that are more likely to benefit from the global recovery from COVID-19, particularly commodity-driven Brazil and the technology markets of South Korea and Taiwan.

Stocks in Malaysia and the Philippines have been among the world’s worst performers this year, southeast Asia is still dealing with a pandemic backlash, and in China, an index of Internet stocks has lost more than a third of its value since peaking in February amid a government crackdown on the tech sector.

Spark Global Limited reports:

Another challenge comes from China. China’s economic growth, once a bellwether for the global recovery from the pandemic, has slowed as demand for exports has weakened. The prospect that the Federal Reserve will act to reduce its stimulus is another headwind weighing on currencies in developing countries.

Against this backdrop, emerging market equities continue to fall. The developed markets index trades at a forward PE ratio of 13 times, more than two standard variances below the five-year average for developed markets.

Gerard said State Street is cautious about Southeast Asia and Mexico, where the outbreak is putting pressure on earnings growth.

Still, there are those who think emerging markets will eventually outperform.

“Not only will many emerging markets be seen as cyclical recovery options that have not yet been fully priced in, but large-cap technology stocks, which are heavily indexed in emerging markets, may come back into focus,” Morgan Harting, a fund manager at Alliance Bernstein in New York, said in a written response. “As some regulatory concerns are clarified, I expect some industry strategists to refocus on Chinese companies.”

 

Us debt rose four months in a row, why are still a few top investment banks bearish?

Spark Global Limited reports:

As the outbreak in the US turned on its head last week and the market became more sceptical about the prospects for an economic recovery, us treasuries continued to rise, in fact, for the fourth consecutive month. Still, Wall Street giants are sticking to their bearish stance.

The epidemic situation is grim and the economic outlook is not optimistic

Every state in the US reported more COVID-19 cases in the past week than in the previous week, according to Johns Hopkins University.

Last week, San Diego, Calif., and Los Angeles both saw their biggest single-day increases since February, with Los Angeles’ hospital admissions more than doubling in two weeks. And in Florida, new cases nearly doubled in two weeks, from 7.8 percent in the week of July 2 to 15.1 percent last week, according to state health data.

Spark Global Limited reports:

At present, the novel coronavirus has increased the difficulty of global epidemic prevention, and put forward higher requirements for vaccination and government governance. The number of new infections in the United States climbed again this week. People are concerned that if the mutant strain spreads and causes a new wave of epidemic, it will undo the gains made in the earlier economic recovery.

According to statistics, the United States is currently under great inflationary pressure. The CONSUMER price index (CPI) rose 5.4 per cent in June from a year earlier, while the core CPI rose 4.5 per cent, the biggest year-on-year rise since November 1991. John Williams, an American economist, has even suggested that the US is at risk of hyperinflation, with inflation now at 13.5%.

Analysts say the current low interest rates on U.S. treasuries reflect the market’s pessimistic outlook for the economy, which is overdone compared to reality.

Overview of Institutional Views

The Fed has already committed to buying $120bn of Treasuries and mortgage-backed securities each month until “further material progress” is made in the recovery. Fed Chairman Jerome Powell has said discussions about an eventual tapering are ongoing, but there is intense debate over the timing and pace.

Morgan Stanley argues that while new evidence continues to show that vaccines are highly effective in reducing severe illness, hospitalizations and mortality. But the bank disagrees that growth is slowing. In fact, the second quarter GDP tracked by the bank’s U.S. economists was closer to 12%. While they expect the pace of growth to slow, they still see a strong economic recovery. On this basis, Morgan Stanley firmly recommends shorting the 10-year Treasury.

Analysts note: The yield on the benchmark 10-year Treasury note fell to its lowest since early February and stocks sold off sharply, just a week after the S&P 500 hit an all-time high and volatility surged. As always, markets are forward-looking, reflecting not only expectations for a strong recovery in the global economy, but also uncertainty on the road to recovery.

The bank notes that the recent collapse in Us Treasury yields is actually due to unwinding positions. In addition, the improved prospect of congress passing an infrastructure package will put upward pressure on yields.

Matthew Hornbach, global head of Macro Strategy, said:

“Economic data is certainly one of the factors that will keep interest rates going up. We disagree that economic growth is slowing. In fact, the second quarter GDP tracked by our US economists was close to 12%. While they expect the pace of growth to slow, they still see a strong economic recovery. Their base case forecasts for US and global growth in 2021 (7.1 per cent and 6.5 per cent, respectively) remain unchanged.”

Iain Stealey, international chief investment officer for fixed income at jpmorgan chase, expects 10-year Treasury yields to rebound to between 1.5% and 2% by the end of the year. But for now, jpmorgan has not increased the size of its short position in US treasuries, saying it would be “more comfortable to see the market improve” before making any real moves.

The net supply of Treasurys fell in June compared with previous months as more outstanding debt came due, according to Citigroup. While many investors have been holding bearish positions for months, they are reluctant to expand those positions by selling more bonds when the market turns sour.

Scott Thiel, chief solid income analyst at BlackRock inc., said while the recent resurgence of the pandemic has indeed dented optimism in the bond market, it is not to the point where we see little new selling today.

It still thinks the restart is real and the economy is recovering. But in the current environment, Treasury yields are too low and the market is too pessimistic about the economic outlook.

On the other hand, concerns about the economic recovery are fueling bond buying. Antoine Bouvet, senior rates strategist at ING, said:

“On the face of it, this level is consistent with a recessionary environment… “There is some moderate scepticism about the strength of the recovery, which suggests a further increase in demand for safe assets even as central banks continue to buy most of them.”

But Bouvet also questioned the strength of the U.S. bond buying spree, saying, “I’m not sure the market really thinks that.” Analysts say the combination of buyers and sellers has pushed yields down too far. At the same time, a strong economic recovery could reverse the decline in yields for some time to come, prompting a rally in Treasuries.

Morgan Stanley Investment Advice

U.S. debt

Still firmly advising against the 10-year Treasury, which is expected to end the year at a yield of 1.8%.

The dollar

It will continue to strengthen in the short term. The growing divergence between the TRAJECTORY of inflation and monetary policy in the US and other large economies is a reason to be bullish on the dollar.

Agency MBS

Maintain a long-term structural reduction view. The prospect of fed tapering and recovery, albeit from low levels, means that demand for agency MBS from both the Fed and banks, the two biggest buyers, is likely to fall at the same time, supporting the case for a reduction.

Will markets face “catastrophic” consequences when the debt ceiling deal expires this week?

Spark Global Limited reports:

As much as $28.5 trillion of U.S. debt is at risk of default if Congress fails to reach an agreement to raise the debt ceiling before Saturday, when a two-year deal to suspend the government’s borrowing limit expires. Five prominent economists weigh in on whether the expiration of the U.S. debt ceiling will have a big impact on markets.

Treasury Secretary Janet Yellen on Friday urged lawmakers to raise or suspend the NATION’s debt ceiling as soon as possible, warning that the Treasury would need to take “extraordinary measures” to prevent a default if Congress did not act by August 2.

Yellen said the issuance of state and local government series debt (SLGS) will be suspended at 24:00 GMT on July 30 until the debt ceiling is suspended or raised.

In a letter to House Speaker Nancy Pelosi, Yellen said Oct. 1, the first day of the next fiscal year, could be a critical date for the nation’s ability to pay its debts without new debt ceiling legislation, because of the large amount of federal spending.

Legendary economist David Rosenberg reported last week that the US debt ceiling could have an impact on markets:

“Watch this deal [to raise the debt ceiling] closely — it hasn’t seeped into the market’s thinking yet.”

We asked five analysts, economists and fixed-income investors how the expiration of the U.S. debt ceiling might affect the market.

Can a deal be reached to raise or suspend the debt ceiling by the end of the month?

In fact, none of the five experts expects any deal to raise the U.S. debt ceiling before the end of July.

Nancy Vanden Houten, chief economist at Oxford Economics, said that because the debt ceiling is considered a “must pass” issue, both parties often use it as leverage for other legislation.

The most likely scenario, Houten said, is that the debt ceiling will be raised, but probably as part of a budget reconciliation measure that Congress isn’t expected to pass until the fall.

Joseph Abate, strategist at Barclays, said:

“The likelihood of resuspending the debt ceiling before July 31 is low. “I think a lot depends on the congressional negotiations on the infrastructure bill and whether they can get a bipartisan bill through the House and get enough votes in the Senate.”

When will the Treasury run out of unconventional measures?

The Treasury has taken extraordinary measures in the past, such as suspending different programs, and Congress has always raised the debt ceiling before those measures run out. Jeff Hibbeler, fixed income portfolio manager at Exencial Wealth Advisors, said:

“Several analysts [reports] I’ve read suggest that October could be the date [for a deal to raise the debt ceiling]. But it depends on the legislative process and how much they want to tie it to the various budgets or other legislation they’re trying to pass.”

All five experts agreed that the Treasury should be able to take unconventional measures by the fall:

“We think they probably have enough cash and borrowing authority to get through September and October.”

Why warn now?

Experts say it is not uncommon for a U.S. Treasury secretary to issue a warning to lawmakers, if for nothing else, generally to prompt them to act quickly. Exencial’s Hibele says:

“The Treasury secretaries don’t want there to be any doubt [about] whether the United States is going to honor its obligations.”

Vanden Houten of the University of Oxford says this is a more unusual time, given the huge costs associated with the outbreak. Vanden Houten says:

“While Congress has always managed to raise or extend the debt ceiling in a timely manner, there is no guarantee that it will do so again, but the consequences of not doing so would be severe.”

How will the market react?

Even if the July deadline passes, market reaction is expected to be muted, experts said. Overall market volatility is likely to rise only if the Treasury’s unconventional measures are exhausted, with the biggest impact on short-term Treasury bills. Overall, however, big, wild swings in yields are unlikely.

Dan Krieter, head of fixed income strategy at BMO Capital Markets, said some short-term investors may view the maturity date as a good opportunity to buy Treasurys at lower costs.

Barclays’ Abate said Treasury yields are likely to fall when investors know extraordinary measures could be exhausted.

Vanden Houten of The University of Oxford also expects more volatility in financial markets, especially if there is still uncertainty about when Congress will raise the cap. Vanden Houten said:

“If the risk of a recession rises, stock prices could fall, and bond investors could demand higher yields if they think there is an increased risk that the Treasury will not be able to repay its debt.”

David Roberts, co-head of Liontrust’s global fixed income portfolio, said that even if the cap was raised at the last minute, it would not have a significant long-term impact on the market.

The last time that happened was in 2011, when the ratings agency Standard & Poor’s downgraded U.S. Debt, and the United States lost its AAA debt rating. However, US Treasury bonds remain among the highest rated in the world, suggesting that markets have little doubt about us creditworthiness.

It’s time to buy gold as a hedge against the global currency flood!

Spark Global Limited reports:

Credit Suisse argues that gold may be undervalued on a strictly fundamental basis. Moreover, with the ever-present risk of runaway central banks and market crashes, and the explosive growth of the global money supply, now is the time to buy gold shares as a hedge against risk. It sees at least 7 per cent further upside.

According to Global equity strategist Andrew Garthwaite, gold shares trade at an unusually cheap 12-month rolling price-to-earnings ratio (a 25 per cent discount to the broader market, compared with a 30 per cent premium normally), as well as cheap price-to-book relative to the broader market.

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As for gold itself, Credit Suisse notes that it is also at the bottom of a 10-year range relative to silver or industrial commodities, and is 20 per cent below its 2011 peak in real, inflation-adjusted terms. Gold technicals suggest an upside breakout.

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[Gold price upside potential]

According to the Credit Suisse model, gold prices are driven by TIPS yields and the dollar. Given the current decline in TIPS yields (considered real interest rates) and future trends, combined with structural bearish views on the dollar, Credit Suisse sees 7% upside potential for gold.

Spark Global Limited reports:

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On a strictly fundamental basis, gold may be undervalued, and there is always the risk that central banks will run out of control and markets will crash. As Garthwaite writes, “Gold is a hedge against extreme financial deleveraging.” He adds:

“Government debt, deficits and corporate debt levels are very high. We continue to believe that if TIPS yield much more than zero, it will start to raise fears of a debt trap, which in turn could lead to a large risk-off trade. This could prompt the Fed to respond by pushing down real yields [and devaluing the currency].”

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Gold also serves as a hedge against explosive growth in the global money supply:

“We think this will also lead to more gold purchases by central banks [as currencies are depreciating]. Central banks account for 12% of gold demand. According to our calculations, if all central banks collectively hold more than 10 per cent gold, gold demand will increase 1.6 times.”

A – share indexes closed down more than 2 percent, the United States in the general education stocks fell before the market

Spark Global Limited reports:

On Monday, the three major A-share indexes collectively fell, with the education and liquor sectors in the green. Afternoon opening, the three major indexes continued to fall. As of 13:44, the gem fell 5% within the day, falling below 3300 points; Shanghai fell 3.39%; The Shenzhen Component Index extended losses to 4 per cent. More than 3,700 shares fell in both markets, while less than 700 shares rose. As of press time, northbound capital has actually sold more than 10 billion yuan net.

Fortunately, in the late session, under the semiconductor assists, A shares of the three major indexes narrowed to within 3 percent.

By the close, the Shanghai index was down 2.34 percent, the Shenzhen Component index was down 2.65 percent, and the Growth Enterprise Market index was down 2.84 percent. On the disk, LED, military and other plates to advance; Medical beauty, cloud games, online education, biological vaccines and other sectors led the decline.

Northbound capital day net sold 12.8 billion yuan, nearly a year high.

Spark Global Limited reports:

Education, liquor plate fell sharply, bad news power is amazing

A share disk today, medical Beauty, liquor, medical, insurance plate led down; Uhv, biological breeding, military, charging pile, semiconductor rise against the trend.

As the Ministry of Education announced over the weekend that it would tighten supervision of online education, the three major after-school training companies plunged by 730 billion yuan. Monday morning A shares, education stocks also fell. Xueda education, Only Education and other direct open limit. Bean god education in the gem also fell by the daily limit. Hong Kong education stocks also took a beating. Afternoon in shares, New Oriental online fell more than 30%; New Oriental -S fell more than 37%.

 

Baijiu shares fell sharply in early trading on Monday, with the sector index down nearly 9% in afternoon trading. Kweichow Moutai broke the 1,800 yuan mark, down nearly 6%; Wuliangye touched the limit, Shanxi Fenjiu, Shere wine industry, Swellfang, tipo wine has previously fallen by the limit.

Among the hot liquor stocks with a market value of less than 100 billion yuan, Swellfun was closed by the trading limit at the opening. The company previously announced that its first-half net profit was 377 million yuan, while its first-quarter net profit was 419 million yuan, meaning that it recorded a net loss in the second quarter. Gujinggong wine plunged 8.38%; Today’s fate fell 8.21 percent. After the opening of the afternoon, Gujinggong wine fell 9.51 percent, the fate of the current limit.

 

Zhongtai securities in a research report pointed out that the recent plate movements or related to money adjustable positions, plate fund positions in the second quarter of liquor ratio decreased, but the fundamentals to see the continuation of the steady, high-end wine in the second half of the performance of steady growth, PiJia have upside, seeking up to upgrade at the same time, the current high-end wine corresponding valuation next year outstanding performance to price ratio. The one-year dimension yield brought by the valuation switch is relatively clear; The secondary high-end medium report is expected to increase in general, and it is optimistic that the core secondary high-end wine enterprises will enter the rapid growth stage of national expansion and dynamic sales volume in the next two years.

The FTSE China A50 tumbled 5 per cent, while the Hang Seng Technologies index posted its biggest drop of the day

The poor performance of A-shares also dragged the FTSE China A50 index lower, extending its daily loss to 5 per cent at press time and marking its biggest intraday drop since March last year.

 

Meanwhile, The State Administration for Market Regulation on Saturday ordered Tencent Holdings LTD to revoke its exclusive rights to online music. Shares of Internet giants fared poorly on Monday, with Hong Kong-based Tencent Holdings falling below the HK $500 mark and closing 6.52% lower in the morning on turnover of more than HK $21.7 billion.

The Hang Seng Technology Index fell in the afternoon, dropping 7 per cent in what was feared to be its biggest intraday fall on record. Meanwhile, Tencent Holdings continued its decline, down 7.38%; Alibaba fell 6.4% on the day, its biggest intraday decline since March.

Meituan, Alibaba-SW and Tencent Holdings accounted for the top three losses in the Hang Seng Index, which fell 1,000 points on the day and extended losses to 4 percent in late trading.

 

Kuaishou fell in late trading and is now down nearly 12 per cent at HK $114.4, below its OFFERING price of HK $115. According to China Securities Journal, on the morning of July 26, a we-media news caused a shock in the market. The news said that the brokerage Morgan Stanley will fast hand target price from HK $300 per share to HK $50 per share. However, the reporter contacted the relevant Hong Kong brokerage analysts said, did not see the relevant research report, this news is the latest research report on Morgan Stanley misreported.

Meituan extended its losses to as much as 15 per cent in late trading, its biggest drop on record. Prior to this, the State Administration for Market Regulation and other seven departments jointly issued “on the implementation of online catering platform responsibility to effectively safeguard the rights and interests of food delivery workers.”

The hang Seng index fell more than 1,100 points to close down 4.13 per cent at its lowest level for the year. The Hang Seng Technology Index closed down 6.57 per cent, its biggest drop of the day. Education stocks were bloody, science and technology stocks collectively tumbled, property management, catering and other plates suffered heavy losses; Semiconductor plate late strong against the market to pull up.

In the United States stocks before the extended decline

In the United States, Chinese education stocks fell before the market, good future fell more than 70%, high road fell more than 63%, New Oriental fell more than 54%, Youdao fell more than 42%. Popular Chinese concept stocks before the market to maintain last week’s decline, shell, Didi fell more than 10%; Tencent Music Fell more than 16% after the state Administration of Market Regulation over the weekend ordered Tencent Holdings Ltd. to revoke its exclusive rights to online music. Futu Holdings, Vipshop will fall 7%, Xiaopeng Automobile, Baidu fell more than 5%.

Securities analysis

Industrial Securities said that the medium-term to maintain the “macro panic in the second half of the year, A share is not A bear market, the market first after the rise of the basic judgment, there is no systemic risk in the market as A whole, flat in the search for novel, structural opportunities are exciting, and the long cattle of science and technology innovation is thriving. However, in the short term, the A-share market is faced with the risk of fluctuations in overseas markets, the pain in the process of reducing the stock risks at home, and the negative impact brought by the changes in supervision policies such as education and Internet. Therefore, the market enters A bumpy period in the short term, and the difficulty of making money in the previous hot topics such as science and technology innovation is increased, and even there are adjustment risks. Investment strategy, it is recommended to take the opportunity to adjust and optimize the position portfolio, the patient layout of high-quality growth stocks on dips, do not recommend blind reduction of positions because of short-term pessimism.

Guotai Junan Securities pointed out that in the second half of the year, there are two major macro risks in the market, the domestic economic recovery pace is more than expected to decline, and the United States continued high inflation caused by Taper pace ahead of time, and high profit growth can simultaneously counter the macro economic growth rate and overseas monetary tightening liquidity shock. Based on this clue, combined with the performance guidance given to us in the announcement, we recommend two main investment lines: 1) high economy sustainable: semiconductor, new energy can pay attention to military, special equipment and other industries; 2) The industry may usher in an economic turning point, and there is room to configure food and beverage, auto parts, consumer electronics, etc.

Essence Securities mentioned that growth continues to become the main line of the market in the middle of the three logic: (1) economic growth center long-term downward: growth is scarce; (2) Neutral loose monetary policy tone: liquidity conducive to growth style; ③ The logic of the long track is not falsified: style switching is difficult to happen. High in the short term, the industry boom and fund allocation direction adjustment makes the new energy, semiconductor and other popular track continue to maintain a strong, future growth stock market is expected to military industry, brokers in the early period of the contour boom stagnation plate and the automobile industry diffusion of marginal improvement recently, such as mid market is still expected to further extension to the small dish.

Citic Securities pointed out that the market liquidity began to tighten, is expected to plate extreme differentiation early end, but the overall market correction risk is very low, stable to good macro fundamentals support structure rebalancing, growth plate from the high track wheel to the low, some consumption and pharmaceutical industry with left layout value.

Meituan fell as much as 15% at one point, and a proposal to protect the rights of food delivery workers landed

Spark Global Limited reports:

In late Hong Kong trading on July 26, Meituan’s fall extended to as much as 15%, its biggest ever.

 

Today, the State Administration for Market Regulation and other seven departments jointly issued “on the implementation of online catering platform responsibility to effectively safeguard the rights and interests of takeaway food delivery workers”. The opinion makes requirements from two aspects:

In terms of ensuring labor income, the platform is required to establish an income distribution mechanism that matches the work task and labor intensity to ensure that the normal income of food delivery workers is not lower than the local minimum wage standard. The “strictest algorithm” shall not be taken as the assessment requirement, and the assessment factors such as order quantity, on-time rate and online rate shall be reasonably determined by means of “algorithm in the middle” and so on, and the delivery time shall be appropriately relaxed.

Improve the social security, urge the platform and third-party cooperative units to participate in social insurance for the food delivery deliveryman who has established labor relations, support other food delivery deliveryman to participate in social insurance, and participate in the pilot of occupational injury protection for flexible employment personnel on the platform in accordance with national regulations. We will encourage exploration of diversified plans to provide commercial insurance and raise the level of multi-level insurance coverage.

Didi has been under scrutiny by seven Chinese authorities. Shortly after its U.S. listing, the company was investigated for illegal collection and use of personal information.

After didi’s accident, the outside world on the rise of meituan rumors swirl. In recent years, Meituan has been expanding its own business, gradually extending its hand to bike-sharing, community group buying, Meituan hotels, cat’s Eye movies, etc. Among them, Meituan’s market share in community group buying has reached the first place.

Meituan may have long wanted to enter the ride-hailing market, but the early entrant is Didi, which, through subsidies and other means, accounted for 90 per cent of 562 million users last year.

In mid-July, Meituan launched its wechat mini program “Meituan Taxi”. The mini program changed its name at the end of June, from “Meituan taxi marketing number” to “Meituan Taxi”. The Meituan Taxi-hailing mini program, which is not unlike the Meituan taxi-hailing App, offers a smart checkbox service and 23 models.

All three major A-share indexes were hit hard by regulatory measures in several countries, with the Growth Enterprise Market down more than 5% at one point. Hong Kong shares also suffered, with the Hang Seng Technology Index closing down 6.57%, its biggest drop of the day. The Hang Seng index fell more than 1,000 points on the day, with Meituan, Alibaba-SW and Tencent Holdings contributing the top three declines.

The Hang Seng Index Company today also launched the Hang Seng New Consumer Index and the Hang Seng Shanghai, Shenzhen and Hong Kong New Consumer Index. The new consumer Index includes alibaba, Meituan and other companies.

Spark Global Limited reports:

The Hang Seng New Consumer Index covers Chinese companies listed in Hong Kong; The Hang Seng Shanghai-Hong Kong Stock Connect consumer Index is A cross-market index, with A range of stocks from China a-share listed companies and Hong Kong stock Connect components. Both indices have a base value of 3,000.

Mr Wong Wai Hung, Chairman and Index Director of Hang Seng Index, said: “The launch of the two indices will provide investors with reference investment options, both onshore and offshore, to capture the emerging opportunities in China’s consumption upgrading trend and help them make informed decisions in cross-border asset allocation.

Both indexes are composed of the 50 largest stocks by average market capitalization over the past 12 months and are subject to semiannual revisions. At the same time, they are all calculated by the floating market value weighting method, and the upper limit of the proportion of individual constituent stocks is 10%.

According to the official website of hang Seng, hang Seng new consumption index of the top ten weighted stocks include: Alibaba (09988) accounted for 13.80%, Meituan (03690) accounted for 8.87%, chuang Co., LTD. (00669) accounted for 5.02%, etc. The top 10 heavyweight stocks in the Hang Seng New Shanghai-Shenzhent-Hong Kong Consumer Index include Meituan, Kweichow Moutai and Wuliangye.