Concept stocks related to the Xiongan New Area in China are undergoing a frenzy of speculation, but you might want to be just spectating instead of speculating unless you see yourself as a master of stock speculation.
Speaking of concept stocks, let us look at BBMG Corporation Ltd (2009.HK)’s price fluctuations on Wednesday.
A less proficient trader would have entered or bought at its high and exited or sold to cut loss at its low. Note that the price of BBMG peaked at 5.25 Yuan on Wednesday, before plummeting by 13.5 percent, followed by a rebound.
The share price of Want Want China Holdings Ltd (151.HK) suddenly surged on Wednesday. This is one of the Hang Seng Index (HSI) constituent stocks that took longer to bottom out and rebound. The HSI had hit bottom at the start of 2016, but Wang Want China shares only bottomed in December last year.
Tingyi Cayman Islands Holding Corp (322.HK), also in the food manufacturing industry, bottomed out in August 2016. Tingyi was once an HSI constituent stock, but it was removed from the HSI after its share price suffered consecutive falls for years. But it seems that the worst was over after it was excluded from the HSI, and it looks like it’s in for a rebound.
I had successfully captured two rebounding stocks last year—Galaxy Entertainment Group Ltd (027.HK) and Yanzhou Coal Mining Co Ltd (1171.HK). The two stocks have now hit another 52-week high. In my opinion, investors should continue holding on to these two stocks as I think that their rebounds are not yet over. Looking at Galaxy Entertainment Group, I expect its increasing hotel occupants to drive up its casino business. As for Yanzhou Coal Mining, it is supported by the Chinese Central Government’s supply-side reforms, and coal prices still stand to rise.
Three Oil Companies Stocks to Own
China Petroleum & Chemical Corp (386.HK), PetroChina Co Ltd (857.HK) and CNOOC Ltd (883.HK) have released their results, with China Petroleum & Chemical Corp being the best performer of the three. However, I expect the other two to rebound too in 2017 when oil prices have bottomed out. Ideally, one should hold all three stocks at the same time.
Similarly, if you are interested in buying mainland telecommunications stocks, I suggest that you own all of the three following stocks at the same time—China Mobile Ltd (941.HK), China Telecom Corp Ltd (728.HK), and China Unicom (762.HK).
My reasoning is that the Chinese Central Government’s telecom policies or reforms will not just benefit one company. Instead, all three will likely have a share of the pie.
But of course, such reforms may take effect at different timings for different companies. On Wednesday, right after China Unicom shares have been halted and suspended from trading (pending an announcement on inside information), China Telecom immediately became the next target of speculation.
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