Coal.com ..... / China

Wow! Does anybody need another example that it is never about valuations and it´s all about liquidity. The longer this run continues and the real interest rate for deposits in China is negative the more unlikely the following outcome will be like this........

Was für Fakten! Hier wird einmal mehr bestätigt das es an den Märkte in den wenigsten Fällen um die Bewertung geht. Die Liquidität dominiert fast immer das Geschehen. Je länger dieser Lauf weitergeht und die Regierung immer noch negative Sparzinsen zuläßt desto unwahrscheinlicher wird wohl folgendes Motto.......

China Shenhua Energy Shares Surge in Shanghai Debut
Oct. 9 (Bloomberg) -- China Shenhua Energy Co., the nation's biggest coal producer, almost doubled on its first day of trading in Shanghai after investors applied for a record 2.66 trillion yuan ($354 billion) of stock.

Shenhua rose as much as 91 percent after the Beijing-based company raised 66.6 billion yuan in the world's biggest share sale this year. Investors ordered 40 times the stock on offer, drawn by first-day trading gains for Chinese companies that averaged 269 percent in the past three months.

The surge gives the coal producer a market capitalization of $173 billion, surpassing Cia. Vale do Rio Doce as the world's second-biggest mining company. Shenhua will use the proceeds to buy mines and expand output to meet demand in the world's fastest-growing major economy, where coal prices have jumped to a record.

Thanks to Bespoke

The Beijing-based company sold 66.6 billion yuan of shares at 36.99 yuan apiece, a 19 percent discount to the closing price of its Hong Kong-listed stock yesterday.

Debut Gains
Shenhua's Shanghai shares are trading at 65 times estimated earnings. China Coal Energy Co., the nation's second-biggest coal producer, is trading in Hong Kong at 52 times last year earnings. Shenhua's Hong Kong shares are trading at a ratio of 42, less than the 54 times average for China's CSI 300 Index, the world's best-performing this year.

Shenhua sold 1.8 billion yuan-denominated shares. The sale surpassed the $8 billion raised by Russia's VTB Group in May. The amount is also a record for a domestic stock offering, exceeding the 58 billion yuan raised by China Construction Bank. .....

China, the largest miner and consumer of coal, became a net importer of the fuel for the first time in January, ending centuries of self-sufficiency and boosting benchmark prices of the fuel at home and at Australia's Newcastle Port to records in August. China burns coal to generate 78 percent of its electricity.

>For a more bullish view on the Chinese Economy (not the stock market) read How fit is the panda? from the Economist. Once in a month i need to post something positive excluding gold....... :-)

> Für einen eher positiven Ausblick für China´s Wirtschaft (nicht den Aktienmarkt) empfiehlt sich How fit is the panda? vom Economist. Ich muß ja zumindest einmal monatlich etwas bullishes ausserhalb von Gold posten...... :-)

Mainland China vs H Shares Hongkong

Time for another China update....... Fascinating!

Zeit für ein neuerliches China Update.......Faszinierend!

A few days ago the Chinese government has indicated that it will expand a program allowing its citizens to buy Hongkong-traded stocks directly to calm down the mainland stock market and ease the liquidity pressure that has driven stocks into the stratosphere.

So far the only thing that happened is that the Chinese shares that are listed in Honkong spiked and have closed a little bit of the gap (although, some shares jumped 70%). Needles to say that the stock market in Shanghai also climbed to multiple new highs. It will be key to watch if the gap in the future will be closed from the bottom (Hongkong 2008 PE 20 ) or from the top ( Mainland PE 40-50).

The longer the markets refuse to close the gap from the top the uglier the awakening should be.

> see also the chart "P/E Ratios: Nasdaq vs China"

Vor einigen Tagen haben die chinesischen Offiziellen durchblicken lassen das es zukünftig möglich sein wird auch chinesische Aktien in Hongkong ohne größere Einschränkungen zu erwerben. Dieser Schritt soll etwas den Druck von den heimischen Aktienmärkten nehmen und die Liquidität etwas breiter streuen.

Bisher hat diese Maßnahme in erster Linie dazu geführt das die chinesischen Aktien die in Hong Kong gelistet sind einen kleinen Teil der Lücke von unten geschlossen haben (obwohl einzelne Aktien über 70% explodiert sind). Überflüssig zu erwähnen das der Index in Shanghai munter weiter neue Hochs markiert hat. Es wird spannend zu sehen sein von welchsem Ende die zukünftige Bewertungslücke geschlossen werden wird. Momentan notieren die China/Hong Kong Aktien mit einem 08 er KGV von rund 20 während die Festlandaktien noch immer mit einem atemberaubenden KGV von 40-50 allen die Show stehlen.

Je länger die Anpassung von oben aufgeschoben wird desto ungemütlicher dürfte das erwachen sein.

> The table shows the run druing the last 5 days and ytd, estimated pe 2008 H shares Hongkong and mainland China, the "theoretical valuation gap", marketcap

Here another example that shows how different the two chinese markets act.

Hier ein weiteres Beispiel das anschaulich zeigt wie verschieden die zwei chinesischen Märkte zur Zeit noch reagieren.

The Financial Times is asking What’s the real Bank of China price?

On Thursday, Bank of China fessed up to holding just under $10bn in US subprime paper and CDOs. While its ‘H’ shares fell more than 6 per cent in Hong Kong in response, the reaction of investors in Shanghai was to push the price of the ‘A’shares up 1.3 per cent.

The gap between Bank of China’s mainland and HK prices has been widening for nine months now. This week the average premium of A shares over H generally widened to 70 per cent for the first time - and that is in response to Monday’s news that China intends to let its residents buy overseas stock (such as H shares)!

> But this is what happens when the central bank is offering deposit rates that are lower than the inflation rate...

> Aber das sollte nicht weiter verwundern wenn die Notenbank den Einlagenzinssatz unterhalb der Inflation festsetzt......