In the first week of 2022, when the A-share and US stock markets weakened, the Hang Seng Index became one of the few major stock indexes in the world that recorded an increase. In 2021, Hong Kong stocks QDII and China concept Internet fund finally ushered in a long drought and rain like rise. Eight ETFs including Hang Seng technology ETF, Hang Seng Internet ETF, zhonggai Internet ETF and Hang Seng technology 30etf rose by more than 3% on January 7.
Hong Kong stocks have been actively sought after by various funds. In the first week of this year, up to 30% of the new shares of ETFs went to Hong Kong stock ETFs. Among them, the net subscription funds of Hang Seng Internet ETF and zhonggai Internet ETF exceeded RMB 1 billion a week. The lower the net value, the higher the share, and constantly set new records. Others, such as financing funds, repurchase of listed companies and southbound funds, also have positive trends. Can Hong Kong stocks, which hurt investors, rebound in the new year? Different institutions have different views.
China concept stocks ushered in a big rebound
The Hang Seng Index closed higher in the first week of the year. Last Friday, Hong Kong stocks continued the previous day's gains, with Internet technology and real estate sectors rising by 6.48% and 5.1% respectively, leading the Hang Seng Index to rebound strongly for two consecutive trading days. The Hang Seng Index rose red for the first time after wiping out the decline in last year.
Overnight, the popular Chinese concept stocks listed in the United States were not affected by the decline of U.S. stocks, walked out of the independent trend and closed up for two consecutive days. Among them, shell, pinduoduo, Lujin holdings, JD, Alibaba and Baidu all rose by more than 5% in two days.
In fact, the Hong Kong stock market performed poorly in 2021, in which the Hang Seng Index fell 14.08%, the Hang Seng technology index fell 32.70% and the Hang Seng Internet Index fell 31.90%. Among the Chinese stocks listed in the United States, about 80% of the companies' share prices fell in 2021, and nearly 40 companies fell by more than 80%. As for the reasons for its decline, Celestica Fund said that the market performance of China's Internet industry was relatively poor in 2021, mainly due to the following aspects:
First, policy. Antitrust and other policies have become stricter, and some leading companies are facing regulatory risks to suppress valuation. Second, fundamentals. China's user traffic is close to the ceiling. The superimposed consumption recession has led to the tightening of enterprise marketing budget, and the growth rate of core advertising business of platform enterprises has been greatly affected. Third, the external environment. The SEC raised concerns about delisting risk due to the review of zhonggai companies, further suppressing the valuation of Chinese Internet enterprises.
2021 is not only the darkest time for China concept stocks, but also a year for heavy positions in Hong Kong stocks and heavy losses in US China concept funds. According to the data, most of the lower ranked funds in 2021 are such funds, and even several funds have an annual decline of more than 40%. Many fund investors choose to stop the loss. The recent data of Hong Kong stock connect show that the southbound funds had a net outflow of HK $1.711 billion and HK $1.575 billion respectively on December 28 last year and January 4 this year.
Recently, Hong Kong stocks and China concept stocks rebounded in the United States, and Hong Kong stock QDII and China concept Internet fund finally ushered in a long drought and rain like rise. Eight such ETFs such as Hang Seng technology ETF, Hang Seng Internet ETF, Hang Seng Internet ETF, zhonggai Internet ETF and Hang Seng technology 30etf rose by more than 3% on January 7.
multi channel fund scavenging Hong Kong stocks
The P / B ratio of Hang Seng index is only 0.97 times. After adjustment, the P / E ratio of the adjusted Hang Seng Index (excluding the high growth and overvalued constituent stocks that have been included in recent one and a half years) in 2021 is only 9.0 times, the lowest in recent ten years. The discount of H shares to A-Shares is also the largest in ten years (the premium of A-Shares is 47%). From the perspective of valuation, Hong Kong stocks are really "cheap". It is the temptation of its undervaluation that after a year of decline, Hong Kong stocks have been actively sought after by various funds.
Hong Kong stock connect data show that the net purchase amount of southbound funds exceeded HK $2 billion for three consecutive days.
Reporter statistics found that in the first week of this year, up to 30% of the new share of ETF flows to Hong Kong stock ETF. In the past week, affected by the withdrawal of the net value of most ETFs, the total scale of ETFs decreased by 19.775 billion yuan. However, the total share of ETFs increased by 20.4 billion against the trend, of which the share of ETFs with Hong Kong stocks and Chinese stocks listed in the United States as the main target increased by more than 6.2 billion, accounting for up to 30%, which is rare. If calculated by the average interval price, the total amount of funds flowing into the overseas market through the subscription of ETF in a week is 4.6 billion yuan. The investors who obtain ETF share are mostly institutional investors or individual investors with high professional level. Their capital flow plays a certain role in indicating market investment opportunities. The large change of ETF share means that most medium and long-term investors are optimistic.
Specifically, the net weekly subscription shares of Hang Seng Internet ETF and Hang Seng Technology Index ETF were 2.172 billion and 1.099 billion respectively. The latest number of shares kept breaking the historical record. The weekly net subscription shares of zhonggai Internet ETF, Hang Seng technology ETF and H-share ETF also exceeded 400 million. Among these ETFs, Huaxia Hang Seng Internet technology ETF (Hang Seng Internet ETF) and e-fund CSI overseas Internet ETF (zhonggai Internet ETF) have the largest scale, both exceeding 10 billion yuan, and the net subscription capital per week exceeds 1 billion yuan. Hang Seng Internet ETF and zhonggai Internet ETF have heavy positions in the three quarterly reports, covering Tencent holdings, Alibaba, meituan, Jingdong, pinduoduo, etc.
In addition, the positive performance of the secondary capital market also played a supporting role in the rebound of Hong Kong stocks. For example, Huaxia Hang Seng Internet technology ETF received financing funds with a net purchase of RMB 262 million a week, ranking first in the ETF sector. Huaxia Hang Seng ETF and e fund CSI overseas Internet ETF also ranked among the top 10 in the net purchase amount of financing funds a week On December 30, the highest price of Shangtang listed in Hong Kong doubled from the IPO price, and the latest market value reached HK $245 billion, exceeding market expectations. In the U.S. stock market, Charlie Munger, vice chairman of Berkshire Hathaway, increased his positions for several consecutive quarters in the process of the continuous decline of Alibaba's share price, and the number of positions nearly doubled in the fourth quarter, showing an optimistic attitude.
According to the data, as of December 31, 2021, 191 listed companies in Hong Kong had repurchased, with a cumulative repurchase amount of HK $38.246 billion, an annual high. For example, during the period of Xiaomi group and Tencent holdings, they repurchased HK $8.387 billion and HK $2.599 billion respectively. In 2022, the repurchase tide continues. Tencent holdings spent about HK $200 million on repurchase on January 5 and January 6 respectively for two consecutive days, and Xiaomi group also continued to repurchase. The repurchase amount of YaoMing biology this year has exceeded HK $840 million. China Industrial Securities Co.Ltd(601377) pointed out that taking history as a mirror, the repurchase tide may be the leading signal of future stock price rise. Since 2008, Hong Kong stocks have experienced five rounds of corporate buybacks, all of which occurred in a bear market. The price of Hang Seng Index shows a negative correlation with the number of corporate buybacks. Large scale corporate buybacks often herald a phased bottom, and follow-up are accompanied by a wave of rising market.
Can "cheap" Hong Kong stocks be copied?
Some market participants pointed out that the undervaluation of Hong Kong stocks has become a market consensus. However, liquidity plays an extremely important role in the valuation level, and low liquidity is easy to cause the undervaluation trap.
Can Hong Kong stocks, which hurt investors, rebound in the new year? Different institutions have different views.
Harvest Fund Zhang Jintao said that the situation of Hong Kong stocks in 2022 may be better than that in 2021, mainly because Hong Kong stocks are currently in a relatively low position and can now find many "cheap" stocks. However, the stock price cannot rise for no reason. It needs fundamental catalysis, such as the improvement of corporate profits, and the prerequisite for corporate profits is macroeconomic stability.
Hu Yaosheng, fund manager of ChuangJin Hexin, believes that the valuation of excellent companies in the consumer industry and Internet sector in Hong Kong stocks has reached a very low level. From the perspective of decline range and time, the pessimistic expectations have been fully reflected, and the stock price has fully reflected the negative factors. Once there are positive signals and favorable factors, or the counter cyclical policy adjustment in 2022, China's economy will return to the upward trend, including consumption, the Internet and other industries that favor people's livelihood, which will be in the process of improving performance month on month and increasing risk appetite. Therefore, at present, we should seize the opportunity of falling, reverse investment and grasp the structural investment opportunity of Hong Kong stocks in 2022.
Zheng Dong, fund manager of Hang Seng Qianhai, said that for Hong Kong stocks, listed companies are basically facing the bottom. In terms of liquidity, affected by the tightening of monetary policy by the Federal Reserve and the rise of the US dollar, the capital outflow trend is obvious, and the overall performance is difficult to be optimistic. Fortunately, the overall Pb of the Hang Seng index is 1.08 times, which is at the variance level of one time below the historical average. The risk release is relatively sufficient, and the overall decline risk is also small. It is expected that the trend is similar to that of a shares, maintaining the shock pattern.
Yu Chenjun, investment director of Huili Group, specially stressed at the recent online strategy meeting: from the perspective of 3-5 years, it is expected that Hong Kong stocks are currently or have been in the bottom area, and the decline will not be normal. Shock and upward are the long-term main trends in the future. Hong Kong stocks are expected to shock upward after reaching the bottom in the first quarter, which is more fully adjusted compared with other markets around the world, It deserves special attention.
(source: Securities Times)
