Latest news with #HongKong-traded
CNBC
4 days ago
- Business
- CNBC
China's suppressed crypto demand is spilling over into these stocks
China essentially banned cryptocurrencies years ago. Now that pent-up demand is finding an outlet in Hong Kong markets as local regulators eye the potential of stablecoins. Hong Kong-traded shares of Guotai Junan International nearly tripled in price Wednesday after becoming the first mainland Chinese-backed securities brokerage to obtain a license for virtual currency trading in Hong Kong . So many mainland-based investors bought the Hong Kong-listed stock that Guotai's total trading value ranked first on the exchange on Wednesday and Thursday, exceeding that of Alibaba, according to Wind Information. Guotai held onto second place on Friday, ceding the top trading spot to Xiaomi after its electric car launch Thursday night, the data showed. As a special administrative region of China, Hong Kong operates under different financial regulations and allows bitcoin trading. In late May, the region passed a stablecoin bill to formalize the process for financial companies to issue and manage virtual assets, primarily those that reference government-issued, or fiat, currencies. "We believe China's newfound interest in stablecoins is driven by concerns that legislation of U.S. stablecoins could extend dollar dominance," Morgan Stanley's Chief China Economist Robin Xing and a team said in a June 19 report. The People's Bank of China "is exploring HK as a sandbox for future payment alternatives," the firm said. While the analysts pointed out that Beijing has banned crypto transactions in mainland China since 2021 , PBOC Governor Pan Gongsheng's high-profile speech in mid-June "signals a pivot." Pan highlighted stablecoins and also noted how digital technologies have exposed weaknesses in traditional payment systems, the Morgan Stanley analysts pointed out. A growing trend among companies Other Chinese companies are jumping onto the trend. Hong Kong-listed financial services firm China Renaissance announced Thursday it plans to spend $100 million over the next two years to invest in cryptocurrency assets and to develop its business in the related Web3.0 realm. On the same day, the company also announced that Frank Fu, a former CEO of crypto exchange Huobi Americas, would join China Renaissance as an independent non-executive director . China Renaissance, also known as CR Holdings, saw its shares gain 20% last week. In the mainland, where stock trading is subject to more price restrictions, Shanghai-listed TF Securities saw gains of nearly 29% last week after it confirmed to investors Friday its wholly-owned subsidiary, TF International, also obtained a license in Hong Kong for virtual assets trading. TF Securities and popular financial information and brokerage company Eastmoney saw the largest turnover by share volume and price last week on the mainland exchanges, according to Wind data, although Eastmoney did not share any virtual assets-related business updates. Its stock climbed by about 11% in the last week. Watch for the drivers behind shares' recent surge The leap in Guotai shares over the past week reflects the market's positive expectations for stablecoin business, Li Dongfang, a Beijing-based finance blogger, said in Chinese, translated by CNBC. But the stock price surge is due more to investors pursuing emerging themes and following first-mover advantage, rather than a reflection of new business growth, Li said. He expects more brokerages to also get similar approvals for virtual asset business, and not see such large fluctuations in stock prices. Part of Beijing's impetus for banning crypto trading was an effort to control financial risks. Speculation takes on a different form with a population of 1.4 billion people. However, the macro trend is clear, if not accelerating. The New York-founded cryptocurrency conference Consensus expanded to Hong Kong this year with its first event in the region in February. Another Consensus event is planned for Hong Kong next year. Recent Chinese business news reports have also scrutinized the potential for stablecoins in Chinese sales of goods overseas via online platforms. They have also highlighted how a unit of Chinese e-commerce company along with Standard Chartered, are among those officially participating in Hong Kong's stablecoin project. "For China, ignoring this trend risks being left behind in the digital infrastructure race – especially as stablecoins increasingly function as bypass mechanisms to traditional banking networks," the Morgan Stanley analysts said.
Business Times
25-06-2025
- Business
- Business Times
Ping An builds HK$180 billion stake in China banks on dividend bet
[HONG KONG] Ping An Insurance Group, as well as other Chinese insurers, have ramped up investments in the nation's biggest banks on a bet that the dividend yields will outweigh headwinds of narrower margins and earnings pressure. Ping An has since late 2024 boosted its holdings of Hong Kong-listed stocks in some of the nation's largest lenders to a combined HK$180 billion (S$29 billion), according to Bloomberg calculations based on exchange data. Its purchases had pushed its stake in the Hong Kong-listed shares of Industrial & Commercial Bank of China to as high as 18 per cent, while holdings in China Merchants Bank and Agricultural Bank of China rose to at least 15 per cent. Its total holdings in the firms are substantially lower when also including their Shanghai-listed shares. The aggressive purchases underscore a growing demand for high-yielding assets amid limited investment options. While Chinese authorities had guided state-backed insurers to allocate 30 per cent of their new premiums to onshore listed shares annually, Hong Kong-traded bank shares offer more appeal with cheaper valuations and high dividend yields. At the same time, Chinese banks are suffering under record low margins and slow profit growth. The years-long property crisis has also dented balance sheets because of a jump in bad loans. The government has underscored its backing for the lenders by a massive recapitalisation. 'The historically low valuations and high dividend payouts have made banking stocks an inevitable choice for those in the hunt for dividends or long-term investors looking to build defensive positions,' said Yang Bo, an investment director with Shenzhen Zenith Investment. BT in your inbox Start and end each day with the latest news stories and analyses delivered straight to your inbox. Sign Up Sign Up The Hong Kong-listed shares of China's largest banks had an indicated average dividend yield of more than 4 per cent, compared with a 1.65 per cent yield on the benchmark 10-year government bonds. Other Chinese insurers had also been actively buying bank stocks. Rui Life Insurance in March raised its stake in Hong Kong-traded China Citic Bank to 5 per cent from 4.98 per cent. New China Life Insurance in January bought a 5.45 per cent stake in Shanghai-listed Bank of Hangzhou from the Commonwealth Bank of Australia. Ping An preferred the bank stocks for their quasi-fixed-income attributes and state backing, it said in a response to a Bloomberg News inquiry. Their low volatility and high dividends will contribute substantial interest spreads, the insurer said, adding it also added non-bank shares in its portfolio to cut risks. 'We will adhere to a balanced approach of investing in both growth stocks and high-dividend value stocks,' it said. Ping An's total investment portfolio of insurance funds is 5.9 trillion yuan (S$1 trillion). The buying has fuelled a sector-wide rally, sending a gauge of Hong Kong-listed Chinese banks to a seven-year high. China Citic Bank, one of the best performers this year, hit a record high while AgBank closed at the highest since its 2010 listing on Tuesday (Jun 24). Yang of Zenith said while the momentum may persist in the short term, the sustainability of the rally remains to be seen as the banks are still contending with a contraction in margins, high funding costs and weak financing needs from the real economy. 'The stock performance has deviated from banks' fundamentals,' he said. 'We will have to see whether their credit expansion translates into real economic activity, as well as how local government debt and property sector risks unravel going forward.' BLOOMBERG
Yahoo
12-06-2025
- Business
- Yahoo
Chinese Stocks' Premium Over Hong Kong Peers Drops to 5-Year Low
(Bloomberg) -- The premium that Chinese stocks command over their Hong Kong-traded peers has narrowed to a five-year low, suggesting that some investors may look to snap up onshore stocks that have become cheaper. Shuttered NY College Has Alumni Fighting Over Its Future Trump's Military Parade Has Washington Bracing for Tanks and Weaponry NYC Renters Brace for Price Hikes After Broker-Fee Ban NY Long Island Rail Service Resumes After Grand Central Fire Do World's Fairs Still Matter? Stocks listed on mainland exchanges, known as A-shares, are now trading at a 27% premium to their counterparts across the border, according to the Hang Seng Stock Connect China AH Premium Index. The valuation gap often widened again when the premium dipped to below 30% in previous occasions. The CSI 300 Index, a benchmark for onshore shares, has lagged the Hang Seng China Enterprises Index this year, set for the widest underperformance since 2003. While the HSCEI gauge entered a bull market earlier this week, the rebound on the mainland has been much more tepid as the market lacks policy catalysts to draw fresh money. In the case of some stocks favored by global investors like BYD Co. and Contemporary Amperex Technology Co., A-shares are trading at a rare discount to H-shares, according to calculations by by Bloomberg. New Grads Join Worst Entry-Level Job Market in Years American Mid: Hampton Inn's Good-Enough Formula for World Domination The Spying Scandal Rocking the World of HR Software The SEC Pinned Its Hack on a Few Hapless Day Traders. The Full Story Is Far More Troubling Cavs Owner Dan Gilbert Wants to Donate His Billions—and Walk Again ©2025 Bloomberg L.P. Error in retrieving data Sign in to access your portfolio Error in retrieving data Error in retrieving data Error in retrieving data Error in retrieving data
Yahoo
27-05-2025
- Automotive
- Yahoo
BYD Shares Extend Losses as Price Cuts Throw Spotlight on Sales
(Bloomberg) -- BYD Co. shares extended losses in Hong Kong trading Tuesday — taking their two-day slide to more than 10% — as last week's sweeping price cuts stoked concern of another wave of discounting in China's cutthroat electric car market. NY Private School Pleads for Donors to Stay Open After Declaring Bankruptcy UAE's AI University Aims to Become Stanford of the Gulf NYC's War on Trash Gets a Glam Squad Pacific Coast Highway to Reopen Near Malibu After January Fires The stock fell as much as 4% in morning trading, following Monday's 8.6% drop. The selloff was sparked after the EV giant announced cuts of as much as 34% on 22 electric and plug-in hybrid models in China until the end of June. The move came after the company last month posted its slowest year-on-year growth in vehicle deliveries in more than four years. While April sales rose 21% from a year earlier, that was the smallest monthly gain since August 2020, except for a drop in deliveries in February last year, when the Lunar New Year holiday saw nationwide industry sales contract 22%. Rival Geely Automobile Holdings Ltd.'s compact hatchback Xingyuan last month became the top-selling model in China, overtaking BYD's popular Seagull, according to data from the China Automotive Technology and Research Center. Morgan Stanley analysts said the price competition sparked by BYD is likely to drag on, with ripple effects into the second half of the year. What Bloomberg Intelligence says: BYD's latest price cuts across 22 electric vehicle models highlight its 2025 focus on volume, forcing rivals to deepen discounts or concede sales and market share. China's auto price discounts averaged 15%-16% this year and can potentially increase in 2H, despite government subsidies driving industry growth. - Joanna Chen, autos analyst The steep price cuts have taken some of the gloss off what has so far been a stellar year for BYD. The stock hit a record high last week, it posted its best month of sales in China and outsold Tesla Inc. in Europe for the first time in April, and raised HK$43.5 billion ($5.5 billion) in a Hong Kong share sale in March. Before this week's slide, BYD Hong Kong-traded shares had surged almost 75% this year, and with a market value equal to around $158 billion, is bigger than Ford Motor Co., General Motors Co. and Volkswagen AG combined. On the technology front, it has unveiled a lineup of cars it says can charge in five minutes, and started to make its God's Eye advanced driver-assistance system standard in vehicles priced from 100,000 yuan ($13,900) and include it in several lower-cost models such as the popular Seagull hatchback. Some of the recently discounted models include those equipped with God's Eye. Investors will get more insight into how BYD is tracking when monthly sales for May are released on Sunday. --With assistance from Danny Lee and Chunying Zhang. Mark Zuckerberg Loves MAGA Now. Will MAGA Ever Love Him Back? Why Apple Still Hasn't Cracked AI Inside the First Stargate AI Data Center How Coach Handbags Became a Gen Z Status Symbol AI Is Helping Executives Tackle the Dreaded Post-Vacation Inbox ©2025 Bloomberg L.P. Error in retrieving data Sign in to access your portfolio Error in retrieving data Error in retrieving data Error in retrieving data Error in retrieving data
Mint
27-05-2025
- Automotive
- Mint
BYD Shares Extend Losses as Price Cuts Throw Spotlight on Sales
(Bloomberg) -- BYD Co. shares extended losses in Hong Kong trading Tuesday — taking their two-day slide to more than 10% — as last week's sweeping price cuts stoked concern of another wave of discounting in China's cutthroat electric car market. The stock fell as much as 4% in morning trading, following Monday's 8.6% drop. The selloff was sparked after the EV giant announced cuts of as much as 34% on 22 electric and plug-in hybrid models in China until the end of June. The move came after the company last month posted its slowest year-on-year growth in vehicle deliveries in more than four years. While April sales rose 21% from a year earlier, that was the smallest monthly gain since August 2020, except for a drop in deliveries in February last year, when the Lunar New Year holiday saw nationwide industry sales contract 22%. Rival Geely Automobile Holdings Ltd.'s compact hatchback Xingyuan last month became the top-selling model in China, overtaking BYD's popular Seagull, according to data from the China Automotive Technology and Research Center. Morgan Stanley analysts said the price competition sparked by BYD is likely to drag on, with ripple effects into the second half of the year. What Bloomberg Intelligence says: BYD's latest price cuts across 22 electric vehicle models highlight its 2025 focus on volume, forcing rivals to deepen discounts or concede sales and market share. China's auto price discounts averaged 15%-16% this year and can potentially increase in 2H, despite government subsidies driving industry growth. - Joanna Chen, autos analyst The steep price cuts have taken some of the gloss off what has so far been a stellar year for BYD. The stock hit a record high last week, it posted its best month of sales in China and outsold Tesla Inc. in Europe for the first time in April, and raised HK$43.5 billion ($5.5 billion) in a Hong Kong share sale in March. Before this week's slide, BYD Hong Kong-traded shares had surged almost 75% this year, and with a market value equal to around $158 billion, is bigger than Ford Motor Co., General Motors Co. and Volkswagen AG combined. On the technology front, it has unveiled a lineup of cars it says can charge in five minutes, and started to make its God's Eye advanced driver-assistance system standard in vehicles priced from 100,000 yuan ($13,900) and include it in several lower-cost models such as the popular Seagull hatchback. Some of the recently discounted models include those equipped with God's Eye. Investors will get more insight into how BYD is tracking when monthly sales for May are released on Sunday. --With assistance from Danny Lee and Chunying Zhang. More stories like this are available on
