China A-shares Monthly Wrap_ Dec 2024_ Market supported by onshore net inflows. Thu Jan 02 2025

Summary of Key Points from the Conference Call Industry Overview - Industry: Chinese A-shares market - Date: January 2, 2025 Market Performance - A-share Indices: - CSI300: +0.5% - CSI500: -2.2% - CSI1000: -3.7% - HSI: +3.3% - HSCEI: +4.9% [1][13] - Investor Sentiment: Onshore investors are optimistic about state-owned funds stabilizing the A-share market and are cautious about selling positions in China exporters to the US [1][9]. Earnings and Estimates - EPS Growth: Consensus estimates for CSI300's 2024 EPS growth remained stable at +5.5% [1][19]. - Net Outflows: EPFR data showed a net outflow of US$249 million from A-shares in the four weeks ending December 27, with 98% from active funds [1][9]. Sector Performance - Top Performers: - Utilities: +3% - Energy: +2% - Financials: +2% [1][7] - Bottom Performers: - Real Estate: -10% - Healthcare: -6% - Materials: -5% [1][8] Economic Indicators - Retail Sales: Increased by 3.0% year-on-year in November, but showed a sequential decline of 1.1% month-on-month [1][27]. - Industrial Production: Rose by 5.4% year-on-year, with a sequential gain of 1.0% month-on-month [1][30]. - Fixed Asset Investment (FAI): Grew by 2.4% year-on-year in November, below expectations [1][27]. - Exports: Increased by 6.7% year-on-year, but showed a sequential decline of 1.9% month-on-month [1][29]. Margin Financing and Fund Issuance - Margin Financing: Balance as a percentage of A-share market cap fluctuated around 2.4% in December [1][10]. - Fund Issuance: Equity fund issuance slowed to RMB 8 billion in December from RMB 42 billion in November [1][11]. Additional Insights - Consumer Sentiment: Retail sales data indicates fragile consumer sentiment, with declines in various product categories [1][28]. - Investment Breakdown: Manufacturing investment outperformed with a growth of 9.3% year-on-year, while real estate investment remained weak at -11.5% year-on-year [1][27]. This summary encapsulates the key points from the conference call, highlighting the performance of the Chinese A-shares market, sector dynamics, economic indicators, and investor sentiment.