Thus, following the close of our long put on EEM last week, we are adding a few Chinese names like:
China Resources Cement – 1313 HK below 8.94 for a 10 target
Construction sector deserves a revisit. Concerns about financing for local government financing vehicles, including funding for PPP projects, led to a poor performance for the construction sector in 1H18 (down 18% based on the Hang Seng Large Cap Index; Figure 1). Clear policy support for infra-structure investment and local government financing vehicles should mitigate the concerns.
Agricultural Bank of China – 1288 HK below 3.83 for a 4.8 target
Sinopec – 386 HK below 7.4 for a 8 target