Breakfast | China Securities Regulatory Commission: Accelerate the formulation and revision of the Securities Investment Fund Law, etc., and greatly increase the cost of securities violations and violations

Macro news

1. At the 49th meeting of the International Monetary and Financial Committee (IMFC) held by the International Monetary Fund recently, Pan Gongsheng, Governor of the People's Bank of China, pointed out that since the beginning of this year, China's economic operation has continued to pick up and improve, and high-quality development has been steadily promoted, laying a solid foundation for the completion of the annual economic and social development goals. The prudent monetary policy is flexible, moderate, precise and effective, strengthens counter-cyclical adjustment, and comprehensively uses interest rates, reserves, re-lending and other tools to effectively serve the real economy, effectively prevent and control financial risks, and create a suitable monetary and financial environment for the economic recovery.

2. The China Securities Regulatory Commission will deepen cooperation with Hong Kong and take five measures to further expand and optimize the Stock Connect mechanism. Among them, measures include supporting leading enterprises in the Mainland industry to list in Hong Kong, relaxing the scope of eligible products of equity ETFs under Stock Connect, and supporting the inclusion of RMB stock trading counters in Hong Kong Stock Connect.

3. Recently, the Ministry of Commerce and other ten departments jointly issued the "Several Policies and Measures on Further Supporting Overseas Institutions to Invest in Domestic Science and Technology Enterprises". It mentions that the Ministry of Commerce is taking the lead in revising the Administrative Measures for Strategic Investment by Foreign Investors in Listed Companies to further relax the restrictions on strategic investment by foreign investors in listed companies.

4. Affected by the heavy rainfall in recent days, there is an obvious flood process in the Beijiang River in the Pearl River Basin. According to the forecast, the heavy rainfall in South China will continue in the near future, and a catastrophic flood will occur in the Beijiang River in the Pearl River Basin. On the 21st, the Ministry of Water Resources organized a flood prevention meeting, and connected with the Guangdong Provincial Department of Water Resources and the Pearl River Water Conservancy Commission via video to arrange and deploy heavy rainfall prevention and response, and the Ministry of Water Resources upgraded the flood prevention emergency response for Guangdong Province to Level III.

5. [China Securities Regulatory Commission: Accelerate the formulation and revision of the Securities Investment Fund Law, etc., and greatly increase the cost of securities violations and violations] The Theoretical Learning Center Group of the Party Committee of the China Securities Regulatory Commission issued a document today saying that it will strengthen the construction of the rule of law in the capital market. When the rule of law is prosperous, the market is prosperous, and when the rule of law is strong, supervision is strong. It is necessary to give better play to the role of the rule of law in consolidating the fundamentals, stabilizing expectations, and benefiting the long-term in the high-quality development of the capital market. Accelerate the formulation and revision of laws and regulations such as the Securities Investment Fund Law, the Regulations on the Supervision of Listed Companies, the Regulations on the Supervision of Corporate Bonds, and the Regulations on the Administration of Real Estate Investment Trusts, so as to significantly increase the cost of securities violations of laws and regulations. Strengthen the three-dimensional accountability of administrative, civil and criminal cases, increase the application of the special representative litigation system for securities disputes, provide a fair and orderly market environment for all types of entities, and promote the innovative development of the capital market with high-quality legal guarantees.

6. [U.S. Secretary of State Antony Blinken to visit China from Wednesday] U.S. Secretary of State Antony Blinken will visit China from the 24th to the 26th, and this is his second visit to China in less than a year. Blinken will visit Shanghai and Beijing, where he will meet with senior Chinese officials including Politburo member and Foreign Minister Wang Yi to discuss a range of bilateral, regional and global issues, including the Middle East crisis, the Russia-Ukraine war, and the situation in the South China Sea and the Taiwan Strait, the State Department said.

Industry news

1. The China Securities Regulatory Commission (CSRC) formulated and promulgated the Regulations on the Administration of Securities Transaction Costs of Publicly Offered Securities Investment Funds, which will be officially implemented from July 1, 2024. The main contents of the "Provisions" include reducing the commission rate of fund stock transactions and reducing the upper limit of the distribution ratio of fund managers' securities trading commissions. The "Provisions" proposes to strengthen the supervision of the public offering commission distribution industry, and the upper limit of the transaction commission distribution ratio will be reduced from 30% to 15%. In addition, the "Provisions" also proposes that the stock transaction commission rate of passive equity funds managed by fund managers shall not exceed the average stock transaction commission rate in the market in principle, and other expenses such as research services and liquidity services shall not be paid through transaction commissions.

2. The China Securities Regulatory Commission (CSRC) has formulated the "Sixteen Measures for the High-level Development of Capital Market Services for Science and Technology Enterprises", and put forward all-round supportive measures from listing financing, mergers and acquisitions, bond issuance, private equity investment, etc. Among them, it is proposed to optimize the listing and financing environment for science and technology enterprises, support the overseas listing of science and technology enterprises in accordance with laws and regulations, increase the refinancing support for science and technology enterprises, study the establishment of a shelf issuance system for the science and technology innovation board and the growth enterprise board, and appropriately improve the inclusiveness of the restructuring valuation of asset-light science and technology enterprises.

3. Recently, the Q1 performance of many storage companies is promising. The reporter of the Financial Associated Press learned from multiple interviews that the production reduction and price increase of the original storage factory drove the performance of the storage industry chain enterprises to rebound. In addition, the implementation of AI applications has also brought a certain pull to the storage industry. A chip purchaser from an AI company told the Financial Associated Press reporter that there is still a sharp price increase in DRAM in this quarter (Q2), with a range of as much as 10%-20%, and an increase of more than 50% since July last year.

4. Recently, the China Securities Regulatory Commission (CSRC) agreed that ChinaClear will launch a unified inquiry platform for public fund account shares and the "Fund E Account" APP will be officially launched, and investors can directly download and use the "Fund E Account" APP through major mobile phone application stores.

5. On the afternoon of April 20, led by the People's Government of Haimen District, Nantong City, Zhongnan Urban Construction, the controlling shareholder of Zhongnan Construction, negotiated cooperation with PAG Investment Group (PAG), a well-known private equity investment company in Asia, and Jiangsu Asset Management. This is the second time that PAG plans to help Chinese real estate developers after Wanda Commercial Management.

6. Chongqing and Chengdu have successively notified residents of gas problems, and the overcharged gas fees will be refunded in full. In Chongqing, 14 cases have been filed for investigation, and those responsible for violations of laws and regulations confirmed by the investigation and those responsible will be seriously held accountable; in Chengdu, at present, all complaints have been accepted, 1,189 cases have been handled, and the remaining 807 cases are being handled step up.

7. China National Nuclear Corporation announced that the mainland has realized the localization of carbon 14 isotopes. Previously, the mainland's supply of carbon-14 was almost entirely imported, which was expensive and insecure. After the completion of the carbon-14 target out of the reactor, it will be supplied to the market by the end of this year after back-end processing, and the output can fully meet the domestic demand, and will effectively promote the development of the mainland isotope application industry chain.

8. A Tesla Chinese owner asked Musk on social media on April 20, "I look forward to Tesla's FSD (full self-driving) entering China as soon as possible, I don't know when it will be realized? When will the HW3.0 system be able to use 3D modeling images? When will the new reversing assistance be pushed to China's Tesla HW3.0 owners?", Musk replied, "It may be realized soon."

9. Since the beginning of this year, the cost of pulp has been rising, and household paper manufacturers have raised prices several times, but the landing situation is not ideal. The reporter of the Financial Associated Press learned that the white cardboard and cultural paper were hit by high costs and insufficient demand, although the price increase continued, but the profitability level declined year-on-year, falling to a historical low. The industry generally believes that if the unfavorable factors continue, the prospects of paper companies in Q2 are difficult to be optimistic.

10. [Beijing Stock Exchange 920 code segment launched today] Beijing Stock Exchange announced that it will launch the 920 code segment function on April 22. Industry insiders believe that the opening of the new code segment means that the market construction has completed an important step, marking that the Beijing Stock Exchange has a new and exclusive listing "ID card". The Beijing Stock Exchange said that in the future, after the new listed companies determine the securities code through lottery selection or direct number selection, they will use the securities code to complete the inquiry, subscription and listing and trading on the Beijing Stock Exchange.

Company News

1. On April 21, Tesla's official website in China showed that Tesla's Model 3, Y, S, and X were all reduced by 14,000 yuan in Chinese mainland. Among them, the price of the refreshed version of the Model 3 has been reduced to 231,900 yuan, the price of the Model Y has been reduced to 249,900 yuan, the price of the Model S has been reduced to 684,900 yuan, and the price of the Model X has been reduced to 724,900 yuan.

2. Zhongji InnoLight announced that the net profit in the first quarter of 2024 was 1.01 billion yuan, a year-on-year increase of 303.84%.

3. Last Friday evening, the punishment of the China Nuclear Titanium Dioxide case landed: the actual controller of China Nuclear Titanium Dioxide, CITIC and Haitong are expected to be fined and confiscated a total of 235 million yuan.

4. Longsys announced that its net profit in the first quarter was 384 million yuan, a year-on-year turnaround.

5. Wanfeng Aowei announced that there were misleading statements when Interactive Easy replied to investors' questions about "the company and Tesla formed an eVTOL company", and the company and the secretary of the board of directors received a warning letter from the Zhejiang Securities Regulatory Bureau and a regulatory letter from the Shenzhen Stock Exchange.

6. Sugon announced that the chairman of the company received a notice from the Securities Regulatory Commission on suspicion of short-term trading.

7. [TikTok responds to the rumors that "it will fire its general counsel in the United States": 100% is untrue] According to market sources, TikTok is ready to fire the company and ByteDance's general counsel in the United States, Erich Andersen, who has led communication with the U.S. government for many years to respond to the latter's concerns and accusations about "national security", but the effect is not ideal. According to other sources, Anderson has informed other executives that he is ready to resign, but will stay in the company until a suitable successor is found. A TikTok spokesperson said when asked if the company would remove Anderson: "This is 100% untrue. (Interface News)

Global Markets

1. The three major U.S. stock indexes closed on Friday, with the Dow up 0.56%, up 0.01% last week, the Nasdaq down 2.05%, down 5.52% last week, the worst weekly performance since November 2022, and the S&P 500 down 0.88%, falling for the sixth consecutive day, down 3.05% last week. Popular technology stocks fell, Nvidia fell 10%, its market value fell below $2 trillion, and Netflix fell more than 9%.

2. The Federal Reserve said that market participants and observers believe that higher-than-expected interest rates pose the greatest threat to financial stability amid persistent inflation. In its semi-annual financial stability report released on Friday, the central bank wrote that "the most cited risk by market participants is that persistent inflationary pressures could lead to a more restrictive monetary policy stance than expected".

3. Following the passage of the mandatory divestment bill of TikTok last month, on the afternoon of the 20th local time, the U.S. House of Representatives passed the new H.R. 8038 bill by an overwhelming majority of 360:58, which includes the unreasonable requirement to force ByteDance to divest TikTok in the United States or face a ban. A day earlier, Elon Musk spoke out against the ban on TikTok, saying it violated freedom of speech and expression.