Bilibili Earnings Overview<\/h2>\n\n\n\n
Online social media\/video\/gaming company Bilibili (BILI US, 9626 HK) also beat on the big three as the company was able to curtail its loss. Hopefully, the company will achieve profitability soon.<\/p>\n\n\n\n
- \n
- Revenue +12% to RMB 5.66B from Q1 2023\u2019s RMB 5.069B versus expectations RMB 5.606B<\/li>\n\n\n\n
- Adjusted Net Income Loss decreased to RMB 439mm from YoY loss of RMB 1.028B versus loss expectations of RMB 497mm<\/li>\n\n\n\n
- Adjusted EPS loss decreased to RMB 1.06 from YoY loss of RMB 2.51 versus loss expectations of RMB 1.20<\/li>\n<\/ul>\n\n\n\n
Key News<\/h2>\n\n\n\n
Asian equities were largely higher post-Nvidia\u2019s better-than-expected Q1 financial results, with India outperforming, China and Hong Kong underperforming, and Indonesia still off for Vesak Day.<\/p>\n\n\n\n
CNY is off very slightly this week versus the US dollar, with a Mainland media source calling WSJ Fed reporter Nick Timiraos the \u201cFed megaphone\u201d after his comments on higher for longer, which Goldman Sachs CEO David Solomon echoed.<\/p>\n\n\n\n
Hong Kong has been hit with a strong bout of profit-taking as technical analysts would point out that the relative strength index (RSI) breached the 70 level\/upper band, indicating an overbought level. With the severity of the pullback, this is rapidly rectifying with the HS Tech RSI now 54 from Monday\u2019s 73 (back on Jan 22, the RSI hit 22). Hong Kong diverged from the Mainland, with only 47 advancing stocks and 444, although Mainland investors bought the dip. The Hang Seng closed below 19,000, while the HS Tech closed below 4,000.<\/p>\n\n\n\n
Hong Kong\u2019s most heavily traded stocks were Alibaba, which fell -5.25% after PDD\u2019s strong results indicating their market share gain in addition to price wars in cloud and AI and rumors of a convertible deal, similar to JD\u2019s announcement yesterday, Tencent, which fell -0.68%, Kuaishou Technology, which gained +1.72% after strong results yesterday, Meituan, which fell -0.91%, and JD.com, which fell -4.11%. Convertible deals are dilutive, though if the interest rate is low (0.25% for JD), the financial math works.<\/p>\n\n\n\n
Mainland China was off, but not nearly as much as Hong Kong. There was no indication of the National Team buying, looking at its two favored ETFs’ trading volumes. There were positives, including yesterday\u2019s strong results from Pinduoduo and Kuaishou.<\/p>\n\n\n\n
Mainland China media noted President Biden and President Xi\u2019s welcoming message to the 400 attendees from China and the United States attending the 14th<\/sup> China-US Tourism Leadership Summit in Xi\u2019an. CSRC Vice Chairman Fang Xinghai spoke in London, stating, \u201cChinese listed companies traditionally have not paid enough dividends. We are now encouraging them to pay more dividends,\u201d according to Reuters. After the close, President Xi \u201cpresided over a symposium of enterprises and experts\u201d on economic reforms. It’s good to see the economy is garnering attention from the top.<\/p>\n\n\n\n
JP Morgan got attention as their China economist and strategist raised the bank’s 2024 GDP target to 5.2% from 4.8%. On the lighter side, Rihanna is in Shanghai promoting Fenty Beauty. There were some positives though profit taking ruled the day as our trading buddy would say about the positives: \u201cMarket no care, you no care.\u201d<\/p>\n\n\n\n
The Hang Seng and Hang Seng Tech indexes fell -1.70% and -2.41%, respectively, on volume that increased +2.6% from yesterday, which is 128% of the 1-year average. 47 stocks advanced, while 444 declined. Main Board short turnover increased +9.15% from yesterday, which is 95% of the 1-year average, as 13% of turnover was short turnover (remember Hong Kong short turnover includes ETF short volume, which is driven by market makers\u2019 ETF hedging). All factors were negative, as value and large caps falling less than growth and small caps. Energy was the only positive sector, up +0.08% while Consumer Discretionary fell -3.36%, Materials fell -3.15%, and Technology fell -2.48%. Energy was the only positive sub-sector, while retail, materials, and media were the worst. Southbound Stock Connect volumes were moderate\/high as Mainland investors bought a net $449 million worth of Hong Kong-listed stocks and ETFs, including Bank of China a large net buy, Kuaishou, CNOOC, and the Hong Kong Tracker ETF. Meanwhile, Tencent and Meituan were small net sells.<\/p>\n\n\n\n
The Shanghai, Shenzhen, and the STAR Board fell -1.33%, -1.72%, and -1.67%, respectively, on volume that increased +1.86% from yesterday, which is 100% of the 1-year average. 461 stocks advanced, while 4,569 declined. All factors were negative with large caps and value \u201coutperforming\u201d growth and small caps. All sectors were negative, including Materials -2.42%, Communication Services, which fell -1.93%, and Real Estate, which fell -1.69%. All subsectors were negative, led lower by education, base metals, and precious metals. Northbound Stock Connect volumes were moderate as foreign investors sold a net -$459 million worth of Mainland stocks, including Cypc, which was a moderate net buy, Kweichow Moutai and Tongwei small net buys while Foxconn, Weichai Power and Will Semiconductor were small net sells. CNY was lower versus the US dollar. Treasury bonds rallied. Copper and steel fell.<\/p>\n\n\n\n
Last Night’s Performance<\/h3>\n\n\n\n
![\"Asian](\"data:image\/svg+xml;base64,PHN2ZyB3aWR0aD0iMSIgaGVpZ2h0PSIxIiB4bWxucz0iaHR0cDovL3d3dy53My5vcmcvMjAwMC9zdmciPjwvc3ZnPg==\")
<\/figure>\n\n\n\nPast performance is not indicative of future results<\/strong><\/p>\n\n\n\n
<\/figure>\n\n\n\nPast performance is not indicative of future results<\/strong><\/p>\n\n\n\n
<\/figure>\n\n\n\nPast performance is not indicative of future results<\/strong><\/p>\n\n\n\n
<\/figure>\n\n\n\nPast performance is not indicative of future results<\/strong><\/p>\n\n\n\n
<\/figure>\n\n\n\nPast performance is not indicative of future results<\/strong><\/p>\n\n\n\n
Last Night\u2019s Exchange Rates, Prices, & Yields<\/h4>\n\n\n\n
![\"Asian](\"https:\/\/ibkrcampusdev.wpengine.com\/wp-content\/uploads\/2024\/05\/chart-1-4-1024x895-1.jpg\")
<\/figure>\n\n\n\n![\"MSCI](\"https:\/\/ibkrcampusdev.wpengine.com\/wp-content\/uploads\/2024\/05\/chart-2-4-1024x952-1.jpg\")
<\/figure>\n\n\n\n![\"US](\"https:\/\/ibkrcampusdev.wpengine.com\/wp-content\/uploads\/2024\/05\/chart-3-4-1024x738-1.jpg\")
<\/figure>\n\n\n\n![\"Most](\"https:\/\/ibkrcampusdev.wpengine.com\/wp-content\/uploads\/2024\/05\/chart-4-4-1024x429-1.jpg\")
<\/figure>\n\n\n\n![\"Most](\"https:\/\/ibkrcampusdev.wpengine.com\/wp-content\/uploads\/2024\/05\/chart-5-4-1024x428-1.jpg\")
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