Sales commentary, not BofA research

Headlines

l  Y’day: NKY -0.75%, HSI +0.52%, SHCOMP +1.38%, KOSPI -0.08%

l  Overnight: Dow -0.3%, SPX +0.5%, Nasdaq +0.95%

l  CN: Onshore China strong y’day a/f PBOC cuts int rates in relending program + on June Manuf PMI

l  US: Extended gains on positive vaccine news from Pfizer & better than xpctd manufacturing data

l  HK: China lawmakers pass HK security legislation.

l  HK: Protesters took to the streets y’day. 370 arrests were made, incl 10 under the new law

l  HK: Looks like we have a ticker change for New World from 17 HK to 2909 HK until July 9

l  US-HK: House passes new bill imposing sanctions on banks, to be approved by Senate & then Trump

l  CN: PBOC cut int rates on some lending programs to lower borrowing costs of small bizes

l  CN: June Caixin Manuf PMI 51.2; EST. 50.5, highest print this yr & 2 consecutive mths of expansion

l  CN: PBOC says CN will not experience high inflation or deflation & that economy is gradually recovering

l  CN-US: China foreign ministry - CN asked some US media outlets to submit info a/b their CN operations

l  CN-US: FCC - Huawei, ZTE nat’l security threats. US co’s can’t tap $8.3B govt fund to buy their equipmt

l  CN-US: Apple blocks updates on thousands of revenue-generating iPhone games @ CN App Store

l  UK: Oliver Dowden says Huawei Tech will not be part of UK 5G networks in the long term

l  EU: ESPRIT (330) to close half of German outlets & shed 1100 jobs

l  AU: Charter Hall reportedly in talks to buy 49% of Ampol’s 250 filling station props (AFR)

Finally: Chinese prop devt co Country Garden launched the world’s 1^st robotic restaurant in Guangdong. Built by Country Garden’s subsidiary Qianxi Group, the restaurant occupies a 2000m² area, featuring sections incl Chinese food, hot pot & fast food. Diners are served by >20 in-house robots designed for different tasks incl cooking & serving food. “It helps to better run a smooth operation thru the practical application of robots.”  said Zhao Chunsheng, mechanical engineering specialist at the Chinese Academy of Sciences. The Qianxi robotic restaurant can serve some 600 customers w/ 200 menu items thanks to fast serving time. The launch of the robotic restaurant is in line w/ efforts to reduce physical contact b/w people during the Covid-19 pandemic. (Inside Retail)

Vanke sold 50% Guangzhou Trust to strategic investors led by CITIC Trust. help Vanke to recover Rmb39b. (Guandian) >>> Guangzhou Trust was acq’d by Vanke in 2017 for Rmb55.1b. Guangzhou Trust has attributable 2.1m m² land bank mainly in Guangzhou.

Vanke no plans to list its prop mngt arm. (Guandian): Karl still xpcts low likelihood of further value unlocking for Vanke’s other business segments near term

ESR bought 3 logistics props in Jiangsu, 1) GFA 160k m², 2) 35k m² prop under construction, fully pre-leased, 3) a land plot to redevp into a 150k m² project. (CRE Herald)

Hopson Dev to add equity invsmt as principal biz activity, particular in high/new tech, medical science & tech. (Co)

Evergrande unit fails to pay land compensation fees for Beijing land parcels. (REDD) Karl - According to Evergrande, the incident was due to miscommunication of local management at the project company level (instead of any liquidity difficulties). The project company is taking measures to resolve the incident.

Evergrande Jun contract sales Rmb76.1b (↑51%YoY) w/ area 8.6m m², 1H Rmb349b (↑24%YoY) w/ area 38.6m m². Xpcts to reach Rmb800b sales tgt in 2020. (Co)

Centaline - new housing sales in SH reach 10yr high during holiday period

BJ local govt to allow applications for repayment of property loan via housing provident fund

A Living (3319) receives CSRC approval for full H share circulation & to issue additional OS shares

Country Garden Jun contract sales Rmb61b (+1%YoY) w/ GFA 7.3m m² (↑9.7%YoY), 1H Rmb267b (↓5%YoY). (Co)

Jinmao Jun contract sales Rmb37.6b (↑57%YoY) w/ GFA 1.7m m², 1H Rmb103b (↑31%YoY), achieving 51% tgt. (Co)

Beijing Capital Land applies for H-Sh full circulation, to convert unlisted domestic shrs into H shrs. (BBG)

Details of Hong Kong National Security Law published. 4 categories of offences: secession, subversion, terrorism, & collusion w/ a foreign country or external elements to endanger national security. (Xinhua) >>> 1) Beijing will exercise jurisdiction over “complicated” cases such as those relating to foreign interference, or when local authorities cannot enforce law effectively, or the nation’s security is under major threat; 2) For cases Beijing has jurisdiction over, the mainland agency in Hong Kong will launch an investigation & Supreme People’s Procuratorate will assign prosecution authorities. The Supreme People’s Court will assign courts to hear the cases; 3) The law is not retroactive; 4) A dedicated police unit is to investigate cases, while a mainland security office will be set up in HK.     Carrie Lam said national security law won't undermine autonomy.

US Commerce OKs exports on goods in transit to HK thru Aug 28, US Congress launched bipartisan bill to give refugee status to certain HK residents at risk of persecution under Chinese territory’s new national-security law. Pelosi urged US sanctions & other steps against China a/f China passed HK security law. China said will retaliate against US actions on HK. UK says it will not abandon HK a/f China unveils new security law. (Reuters, WSJ)

HK May exports ↓ 7.4%YoY to HK$317.6b. (SCMP)

Digital realty to develop 2nd data center in HK. to provide up to 24 mw

Deferred vacancy tax may cause HK govt loss >HK$2.2b (US$279m) tax income this FY. (SCMP)

K. Wah prices 178 units in K Summit, Kai Tak @ HK$25,974-36,280/ft². Start sale 206 units Jul 4. (HKET)

HDB resale prices ↑marginally of 0.2%QoQ in Q2 amid Covid-19 outbreak: flash estimates. (Biz Times)

S'pore private home prices ↓1.1%QoQ in 2Q: URA flash estimate. (Biz Times)

Beauty World site set to catalyse area's rejuvenation. Commercial & resi plot xpctd to fetch S$780m to S$1.3b; given large invsmt outlay, devrs likely to form consortiums to place bids. (Biz Times)

Frasers Centrepoint Trust to acq add’l 12% interest in AsiaRetail Fund for S$197m ($141m), now holds 36.89%. ARF owns 5 retail malls + 1 office in SG, & 1 retail mall in Malaysia. (Co)

ESR-Reit secures 2 new tenants at 8 Tuas South Lane; they leased 284,700ft². (Biz Times)

SPH Reit proposes Q3FY20 0.5c DPU, portfl occupancy 98.8%, WALE 4.1 yrs. (Biz Times)

United Industrial says President/CEO Lim Hock San to retire

NSW govt approves A$2.6b plans for a major industrial precinct nxt to Western Syd airport. (Prop Observer)

Core Logic (June) House Prices↓0.7% a/f ↓0.4% in May. Despite val being down, mkt activity further improvement. June est’d to be +29.5% a/f (revised) 21.5% surge in sales activity in May. (Domain)

Oz Building Approvals ↓16.4% vs cons ↓7.8%, driven by private sector (ex-houses) ↓35% to 11yr low. ↓in apt approvals not Covid related but more to do w/ construction boom that ended in 2017. (ForexLive)

Charter Hall reportedly in talks to buy 49% of Ampol’s 250 filling station props, according to AFR. (AFR)

Ascendas REIT acq a Syd logistics prop for A$23.5m. The acqn will be accretive to A-Reit’s DPU. (Co)

NxtDC: contracted commitments at NSW data centres now ↑by 4MW, to be >36MW. (Co)   

Japan May retail sales ↓12.3%YoY, followed April’s ↓ 13.9%. (Japan Today)

Tax Agency considering special measures if land prices ↓ significantly. (JPC)

Mitsui Fudosan didn’t repurchase any shrs in Jun. (Co)

Thailand lifts ban on int’l flights on 1 July. (Bangkok Post)

Central Pattana Public approved Bt0.8/sh interim div, lower from prev Bt1.3/sh. (Co)

Supalai bought back 15k shrs @ Bt16.6-6.7/sh for Bt249,500 on Jul 1. (Co)

Vietnam 2Q20 GDP gwth slows to 0.36%YoY, 1H grew 1.81%YoY, per General Statistics Office. (Biz Times)

Four Seasons to reopen its Nam Hai resort in Hoi An, Vietnam from Jul 1. (Hotel News Resource)

S Korea May retail sales ↑ 2%YoY to 11.6trn won ($9.65b). (YNA)

* My pa holdings: BAC US, 1 HK, 6 HK, ST SP