Factbox: China new energy shares, Apple suppliers lead gains as U.S. election result awaited

China Rare Earth Holdings

05/11/2020 06:43

SHANGHAI/HONG KONG, Nov 5 (Reuters) - China's new energy
shares and Apple  AAPL.O  suppliers led the gains in the A-share
market on Thursday, while defence companies lost ground, as
early returns from the U.S. election pointed to a win for
Democratic challenger Joe Biden. 
    While analysts expect little change in U.S. policy toward
China whatever the outcome, a Biden administration is expected
to bring a more nuanced, multilateral approach to trade and a
less hawkish foreign policy toward developments in the Taiwan
Strait. 
    Democrat Joe Biden on Wednesday predicted a U.S. election
win over President Donald Trump after pivotal victories in
Michigan and Wisconsin, while the Republican incumbent sought to
offset a narrowing path to re-election with lawsuits and demands
for a recount.  urn:newsml:reuters.com:*:nL1N2HQ0VQ     
    
    APPLE SUPPLIERS
    China's Apple suppliers have been sensitive to the ups and
downs in the Sino-U.S. trade war, reflecting concerns of
possible Chinese restrictions on U.S. tech firms including the
Cupertino, California-based giant.  
    Shares of those suppliers gained on Thursday, with acoustic
component maker AAC Technologies  2018.HK , BYD Electronic
International  0285.HK  and Sunny Optical Technology  2382.HK 
rising between 3.3% and 6%. 
    On the mainland, Shenzhen Desay Battery Technology
 000049.SZ , Shennan Circuits Co Ltd  002916.SZ , Goertek Inc
 002241.SZ  and Foxconn Industrial Internet  601138.SS  firmed
between 2.7% and 8.9%. 
    
    NEW ENERGY 
    China's new energy firms are expected to benefit from a
Biden presidency, given his pledge to invest more in renewable
energy. 
    Sales of electric, plug-in hybrid and hydrogen-powered
vehicles in China, the world's biggest auto market, are forecast
to rise to 20% of overall new car sales by 2025 from just 5%
now, according to State Council.
    The CSI300 new energy index  .CSI399808  climbed as much as
4.4% on Thursday, having gained nearly 70% this year. 
    Battery giant Contemporary Amperex Technology (CATL)
 300750.SZ  surged about 150% this year, while solar panel
components maker LONGi Green  601012.SS  nearly tripled in
value.
    
    DEFENCE 
    Simmering geopolitical tensions around the Sino-Indian
border, the Taiwan Strait and the South China Sea have boosted
defence companies as Beijing intensifies its military build-up,
including preparations to challenge American power further
afield.  urn:newsml:reuters.com:*:nL3N2ER0YW
    A second Trump administration is likely to exacerbate those
tensions, a potential boon for defence contractors.
    A Biden White House is widely expected to take a less
confrontational approach in its trans-Pacific diplomacy, though
the previous Democratic administration of Barack Obama, in which
Joe Biden served as vice president, also clashed with China over
its claims to the South China Sea. 
    The CSI defense index  .CSI399973  shed as much as 1.6% on
Thursday, bucking a broad rally in the market. The index has
gained over 50% so far this year. 
    
    TECH
    U.S. restrictions on exports to China's tech and
semiconductor industries have marked the sector as a key
battleground in the Sino-U.S. trade war as China drives for
self-sufficiency.
    It is not immediately clear whether Biden would ease
restrictions on China's tech industry if elected. 
    China has been pushing forward with reforms in its capital
markets, including a registration-based IPO system for the
tech-focused STAR Market and Shenzhen's start-up board, to help
better finance its tech industry and foster new growth drivers. 
    The tech-heavy start-up board ChiNext  .CNT  added 1.3% on
Thursday, while the STAR50 index  .STAR50  was up 1.1%. Both
indexes gained 55% and 47%, respectively, this year. 
    China's top chipmaker Semiconductor Manufacturing
International Corp  0981.HK  rose as much as 7.6%, having
rallied nearly 100% this year.  
    
    For Reuters live coverage of the U.S. election, please visit
https://www.reuters.com/live-events/election-2020-15-id2942501

 (Reporting by Donny Kwok, Luoyan Liu and Andrew Galbraith
Editing by Vidya Ranganathan and Devika Syamnath)
 ((luoyan.liu@thomsonreuters.com; Reuters Messaging:
luoyan.liu.thomsonreuters.com@reuters.net))