Large cap Chinese ADRs helped lifting the China ADR index (CAI) by 3.96 points. Still, the index lost a quarter of her value since the beginning of 2008 and jittery market conditions in the U.S. keep pressure on Chinese stocks.

Index	Date	Value	Today	YTD
CAI	6/23/2008	748.49	3.96	-25.15%

Couple of stock of interest: Aluminum corp. of China (ACH). The stock lost another -2.54% today on weak outlook. Today's performance came as no surprise to us, because events just unfolded as we predicted it on last Saturday. Here is the actual posting on the blog from last week (link here):

"Aluminum Corp. of China (ACH), the world's third largest alumina maker, fell -12.8 percent before announcing a weak performance due to soft alumina prices coupled with increased production costs. Bauxite and price of electricity are all up while overcapacity hammered alumina producers. It seems as if things will get worse before they get better for Chalco."

And this was exactly right for today, the world's third largest producer of alumina finished $-0.81 or 2.54% lower for the day.

Another stock to watch was Asia's largest refiner, Sinopec Corp. (SNP). As we have argued on June 20th, investors had to exercise caution when it came to this large cap stock. We posted the pre-market snapshot of our Overbought/Oversold indicator, a report that Advanced Members receive,  and explained why Sinopec is vulnerable to a sizeable negative technical correction. We said that (link to blog post here)

"By looking at the indicator this morning, it is obvious that Sinopec (SNP) traded way out of her range yesterday and as such is susceptible to sizeable retreat today. Actually Sinopec is the most in danger followed by Huaneng Power. These companies are almost certain to reverse course today. Petrochina (PTR) is less vulnerable because the company started yesterday's rally from much lower when it comes to stock characteristics."

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Looking at today's trading landscape strong oil prices helped China's offshore specialist CNOOC Ltd. (CEO), a company with no refining capacity, to lead today's rally. PetroChina, China's largest oil producer, followed suit by finishing up $0.38 or 0.28%. On the contrary, Sinopec (SNP) fell $-2.20 or -2.17% - just as we predicted.

Large cap China Mobile (CHL), the world's largest mobile carrier by subscribers, gained $1.46 or 2.18% on positive outlook. Beijing have started a long-waited telecom industry restructuring (Telecommunications industry overhaul. How to make money?) at the end of May sending underdogs - China Unicom (CHU) and China Netcom (CN) soaring. We have remained positive on China Mobile citing superb customer acquiring ability and excellent profitability.

"China Mobile is not only the biggest among the telecom players but is growing the fastest. And remember: China Mobile's net profit of $12.5 bln for 2007 was twice as much as CHA, CHU and CN combined! " And time has proved us right; China Mobile has been closing on the gap as the following link and chart from Google finance proves it; a trend that we think is likely to continue.

Another stock to watch today was Sohu.com (SOHU), a large Chinese internet portal. The stock came back strong today by gaining $3.92 or 5.45%. Though this might sound super yet I consider it more as a technical rebound after Friday's freefall. As the following chart reveals, despite today's strong showing Sohu is down -8.57% in the last three trading days. See following chart below. As far as what the future hold for this internet company, opinion wary. We are on a view that Sohu is a good medium term (3-6 month) buy with a positive outlook. Remember, the company reported strong 2008 Q1 with quality earnings, a sign that will keep the company going well into later part of 2008. We believe the Olympics in Beijing present an outstanding opportunity for the company, an opportunity that Sohu seems to successfully capture.

Looking at the negative side of the Chinese stock universe, investors may ask how long Baidu.com (BIDU) can go. China's dominant search engine company has been on the losing side for over two months now making investors nervous. The funny part is that while Baidu reported an excellent 2008 Q1, investors seem to ignore the good news and look at Baidu through Google's mirror. As the following chart reveals, Baidu has been tracking the performance of Google very closely year-to-date. Pro for Baidu is the company's unchallenged #1 position in China; con is valuation. While Google is trading at a relatively modest 31 P/E, the same basic valuation measure hits 110 for BIDU.

And finally, here is the snapshot of the biggest movers from the Chinese ADR universe for the trading day.

TOP MOVERS		6/23/2008 16:00
Symbol	Price	Change	Change%
CEO	166.33	$7.58	4.77%
SOHU	75.83	$3.92	5.45%
LDK	39.31	$1.80	4.80%
CHL	68.47	$1.46	2.18%
NCTY	23.26	$1.18	5.34%
LFC	53.86	$0.67	1.26%
SOLF	20.75	$0.51	2.52%
ZNH	21.97	$0.47	2.19%
JASO	19.89	$0.39	2.00%
PTR	133.85	$0.37	0.28%
GA	12.93	-$0.57	-4.22%
NTES	21.32	-$0.62	-2.83%
YZC	85.97	-$0.64	-0.74%
FMCN	26.35	-$0.70	-2.59%
ACH	31.04	-$0.81	-2.54%
CTRP	46.43	-$0.93	-1.96%
SHI	38.01	-$1.04	-2.66%
HNP	31.03	-$1.10	-3.42%
SNP	99.19	-$2.20	-2.17%
BIDU	318.86	-$4.03	-1.25%

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