【News Scan】20161211

胡晨璇： Shenzhen-Hong Kong Stock Connect kicks off The Shenzhen-Hong Kong Stock Connect, the second link between the mainland and Hong Kong bourses, was launched on Monday. Ceremonies were held simultaneously at Hong Kong and Shenzhen bourses via video link as Hong Kong Exchanges and Clearing (HKEX) Chairman Chow Chung-kong and Hong Kong Chief Executive Leung Chun-ying jointly beat a gong to mark the launch. It is the second link of its kind to boost opening up of the mainland's capital market after a similar link between the Shanghai and Hong Kong bourses was launched in 2014. "Following the footsteps of Shanghai-Hong Kong Stock Connect ... Shenzhen-Hong Kong Stock Connect is yet another milestone in deepening mutual access between the capital markets in China's mainland and Hong Kong," Leung said at the ceremony. The new scheme is aimed at giving global investors access to stocks in the tech-heavy Shenzhen market via Hong Kong bourse. A total of 417 stocks on the Stock Exchange of Hong Kong are eligible for trading, and 881 stocks are eligible on the Shenzhen Stock Exchange. Compared with Shanghai-Hong Kong Stock Connect, the new scheme between Shenzhen and Hong Kong represents "an enhanced version" in terms of its expanded scope of eligible securities, as well as the lift of limits on aggregate quota upon its launch, Leung said. The Shenzhen-Hong Kong Stock Connect is exemplary of Hong Kong's combined advantages of "one country, two systems," he said. "We are, indeed, a 'super-connector' between the rest of China and the rest of the world." Hong Kong stocks' benchmark Hang Seng Index opened 15 points, or 0.07 pct, higher on Monday morning. HKEX Chief Executive Charles Li said he did not expect a sharp rise in turnover shortly after the launch. "It's like building a bridge. After the bridge is built, flows of people will arrive in succession in the coming 20 years or so." He described the Shenzhen-Hong Kong Stock Connect as "the second leg" for the stock markets in the Chinese mainland and Hong Kong, "Now we can walk, and then we can run." The connect will see more northbound interest in mid- and large-cap growth stocks, according to Gao Ting, analyst with UBS Securities. "The existing programs that allow overseas investors to invest in mainland markets, QFII/RQFII and the northbound Shanghai-Hong Kong Connect, show that outside investors have a clear preference for lower valuation mid- and large-caps in financials and traditional consumer sectors, such as foods and beverages, home appliances and autos," said Gao in a latest research note. Analysts said that overseas investors, many of whom are institutional investors, are focusing more on stable and steady yields instead of a short-term, speculative approach when trading A-shares. The Shenzhen market has a high concentration of technology stocks, 20 percent of its total market capital, offering a wide range of choices to investors with a strong interest in this fast-growing sector in China, said a research note from Haitong Securities. Food and beverage players, such as Chinese white liquor (baijiu) makers, dairy goods makers, and snacks makers are also among investors' favorite options. Over the past 10 days since the launch of the SZ-HK stock connect was announced, share prices of leading companies in the food and beverage sector have risen over 5 percent. For instance, Wuliangye Yibin Company Limited gained more than 5.8 percent, from some 34 yuan ($4.94) per share to more than 36 yuan per share. Analysts said companies in sectors which are rarely seen in Hong Kong are also likely to win overseas investors' favor because they are supplementary to existing choices in Hong Kong's market. These sectors include machinery, defense-related high-tech, pharmaceuticals, and policy-driven trade and infrastructure players, including those that have benefited from the Belt and Road Initiative and countrywide urbanization. Liu Xiaoning, analyst with Shenwan Hongyuan Securities, said that Shenzhen-listed companies that have significant market share and have disclosed winning bids for infrastructure projects are likely to realize stable and steady profits in the long run. Overseas investors, however, may not decide to participate in the market immediately with large investments as they did when the Shanghai-Hong Kong Stock Connect was launched, because the overall situation of the A-share market is significantly different now, said analysts. "The A-share market is now with more rational and value investors. There won't be investors flocking toward the SZ-HK connect. More will patiently study, research, and make decisions," said a research note from Ping An Securities. 黄洁： A mother's outcry puts school bullying in spotlight A Beijing mother's article describing how her 10-year-old son was bullied at school went viral, bringing back memories for Chinese people who were bullied and triggering widespread discussion on parenting. Zhongguancun Second Primary School, a renowned primary school in Haidian district, on Saturday morning issued a statement saying it has been communicating with parents on both sides, and called for the public to let the school handle the situation. After having a toilet waste-paper basket thrown on his head and being mocked by other classmates, the fourth-grade boy was diagnosed with acute stress disorder, a mental illness characterized by severe anxiety, according to the article published online Thursday. It said the school described the case as a "joke that went too far," and that the parents of the boy who threw the basket believed their son was "just being naughty." The mother wrote that her son had been bullied for almost a year by his classmate. Although the article has not been verified by the other party or the authorities, it has been shared over 100,000 times on WeChat, and read over 6 million times on Weibo, a Twitter-like service. People expressed their outrage over the matter, and recalled their past experiences of being bullied. Bullying and violence at schools and colleges have been widely reported in recent years. The guidelines, jointly released by nine organs including the Ministry of Education, the Supreme People's Court, the Ministry of Public Security, and the Central Committee of the Communist Youth League, ordered schools to be aware of the consequences of bullying and violence, and that officials should be held accountable for serious incidents of bullying or violence in areas under their jurisdiction. Students with severe behavioral problems should be transferred to special schools suitable to their needs, or in more serious cases should receive administrative or criminal penalties, the guidelines said. An official with the Beijing Municipal Education Commission told Xinhua that it had ordered the district commission of education and the school to properly deal with the case. 鲍俞哲： Microsoft plans to win VR race Virtual reality applications in China now exceed those in the United States Microsoft Corp said on Thursday its mixed reality headset, called HoloLens, will come to China in the first half of 2017, as the United States tech giant steps up efforts to tap into the country's software developers and into local firms' desire to achieve digital transformation. Terry Myerson, the executive vice-president of the Windows and Devices company at Microsoft, said the firm will launch HoloLens for Chinese developers and commercial customers. He did not disclose the specific price tag, just saying it will be around $3,000, roughly the same as in other countries. "We believe China, or, broadly speaking, Asia, could be leading the world in terms of mixed reality. We are seeing more virtual-reality-enabled activities here than in the United States," Myerson said on the sidelines of a manufacturing partner conference in Shenzhen. HoloLens allows users to view virtual objects and characters in the real life environment. Microsoft is competing with Google Inc-backed Magic Leap and other players in the race for lead in the nascent market. The company also published technical specifications it co-developed with Intel Corp for PCs that can power headsets capable of mixed reality. Lenovo Group Holding Ltd, Dell Inc and other PC vendors will start shipping the first VR goggles next year. These gadgets will come with the Windows 10 Creators Update, the latest version of its Windows operating system. And unlike other VR headsets, there will be no need for a separate room and complicated setup, Microsoft said. 林楚楚： China's WTO entry benefits world Since entering the World Trade Organization (WTO) 15 years ago, China has witnessed robust economic growth, and an increasingly prosperous China has created significant opportunities for countries around the world. China joined the WTO as its 143rd member on Dec 11, 2001. Since then, the country has grown into the world's second-largest economy and largest trading country, while millions of Chinese have been lifted out of poverty. Changes for the Chinese include buying cheaper cars, enjoying international products and traveling more. "China's WTO entry has brought benefits not only to the country's people, but also for the rest of the world," said a economics professor at Renmin University of China. China has long been vital in helping shore up world economic growth, especially in the aftermath of the 2008 financial crisis. Despite slower growth in recent years, China's economy still contributes 25 percent of the world's growth. As the vast Chinese market has grown, countries as diverse as Zambia, Australia, Brazil and the United States have seen their exports to China soar. It is clear that China's strong demand for imports has been a major stabilizing factor amid a sluggish world economy. Dubbed the factory of the world, China manufactures everything from toys and shoes to bullet trains and industrial robots. From 2001 to 2016, thanks to imported goods from China, consumers around the world saved billions of dollars. Quality yet inexpensive Chinese products contributed to an increase in consumer purchasing power and helped reduce worldwide poverty. Companies that opened operations in China have profited. Foreign-invested industrial enterprises reported combined profits of about15 trillion yuan (around $2.2 trillion) over the past 15 years. Despite a tepid global recovery, the continuous growth of foreign investment in China shows that investors are upbeat about the country's business climate. Looking ahead, China will remain a center of trade and other global activity, playing a leading role in global governance. As China plans to be more proactive in opening up to the outside world, its stable growth will produce more benefits for the world.