Date
24 July 2017
Property and machinery manufacturing stocks are likely to be among the first to benefit from what comes out of the upcoming economic work conference. Photo: CNSA
Property and machinery manufacturing stocks are likely to be among the first to benefit from what comes out of the upcoming economic work conference. Photo: CNSA

Keep an eye on China property, high-tech manufacturing plays

China’s A-share market was quite calm on Monday.

Although the financial sector fell 0.66 percent, the Shanghai Composite Index managed to edge up 0.34 percent, helped by media and entertainment, tourism, nuclear power and venture investment-related counters.

The benchmark closed at 3,536 points. Combined turnover in Shenzhen and Shanghai fell to 751 billion yuan (US$117 billion).

The A-share market still lacks momentum.

The renminbi’s inclusion in the International Monetary Fund’s SDR (special drawing rights) basket is yet to benefit China’s stock market.

Without further policy stimulus, the A-share market has no clear direction.

Media and entertainment companies, benefiting from speculation around movie releases in the new year, rallied 5 percent on Monday.

China Television Media Ltd. (600088.CN) and Wanda Cinema Line Corp. (002739.CN) hit the 10 percent daily limit.

Huayi Brothers Media Corp. (300027.CN) and Times Media (600551.CN) surged 5 percent.

Shaanxi Broadcast & TV Network Intermediary Group (600831.CN) and China South Publishing & Media Group (601098.CN) rose 3 percent.

From December to early February 2016, about 69 new movies will be shown in the mainland, a record high.

The new releases will help grow the market, with record box office receipts having been the norm in recent years.

As part of the “new economy”, the entertainment and media industries have a bright outlook.

On the other hand, the “old economy” which includes low-end manufacturing, will continue to weaken.

Internet Plus, Beijing’s technology-driven economic blueprint, is expected to power China’s transformation.

The coal industry recently launched an Internet Plus initiative featuring an e-commerce platform for coal trading, financing and big data services.

Logistics accounts for 60 percent of coal costs as a result of its low-tech nature.

Internet Plus can help develop an information-based infrastructure to significantly improve efficiency in the supply chain.

The coal sector was down 0.43 percent on Monday.

Investors are waiting for more clues from the upcoming Central Economic Work Conference.

Property and machinery manufacturing stocks are likely to be among the first to benefit from what comes out of these meetings.

This article appeared in the Hong Kong Economic Journal on Dec. 7.

Translation by Myssie You

[Chinese version中文版]

– Contact us at english@hkej.com

MY/DY/RA

a columnist at the Hong Kong Economic Journal

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