Market Wrap by Decoder – 13 Feb 14

• HK/CN ():

o Export growth accelerated to +10.6% YoY (Consensus: +0.1% YoY), up from +4.3% YoY in December, with a notable rise in export growth to G3 countries. Import growth picked up to +10.0% YoY (vs. +8.3% YoY in Dec), despite the LNY effect and a very high base a year ago. Raw material products (iron ore, copper and steel products) booked stronger imports.

o Hang Seng Index: Mengniu (2319) becomes member of HSI with weight 0.73% to replace China Coal (1898). BYD (1211) joined HSCEI component and Zoomlion (1157) was kicked out.

o Prada (1913) 2013 SSSG was +7% YoY and net income increased 9% YoY. Revenue from Prada raised 11% YoY but from Miu Miu went up only 1% YoY. Great China revenue leads the growth in Asia with 15% YoY.

o Esprit Holdings (330) will close 17 loss-making stores in France and more than 100 local employees will be affected.

o Alibaba: Reuters estimates the valuation of Alibaba is US$128bn according the equity transaction between Tiger Global Fund and Giant Group.

o HK Property: Government said it is very unlikely to cancel the double stamp duty tax this year.

o HK Macro: Government said HK need 30k more construction workers due to the future infrastructure construction plan and 20k of them are skilled workers.

o China Anticorruption: Premier Li Keqiang said the so-called three public consumptions (vehicle purchasing and maintenance, overseas trips and official receptions) will definitely decrease in 2014.

• Msia: 4Q GDP +5.1%yoy (above consensus +4.8%yoy/SCB +5%yoy). FY GDP +4.7%yoy Export growth +2.9% yoy, higher than 1.7% a quarter ago, while import growth also accelerated to 4.4% from 1.8%. Sector-wise, agriculture growth slowed to 0.2% y/y from 2.1% in Q3. Manufacturing growth picked up to 5.1% y/y from 4.2%, while construction remained stable (9.7% in Q4 versus 10.1%). Services growth accelerated to 6.4% y/y in Q4 from 5.9% in Q3. Overall a positive result for Malaysia and in line with our view that export growth will continue to improve and support GDP growth in 2014.
• US markets started off higher after positive comments from ST. Louis Fed Reserve President James Bullard. However, markets traded lower along the day although Bullard said that the recent weak economic data had not deterred his optimism about the US economy. Separately, the Senate also voted in favor of the extension of the debt ceiling till March 2015 but there wasn’t any knee jerk reaction from the investors as well. Sector wise, energy/material (yesterday’s leaders) finished among the losers on trading yesterday. 10 years yield inched up 3bps, settling @ 2.76%. Nothing exciting about the T/O, with around 630m shares changed hands.

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