Shares of Chinese oil companies are leading Chinese ADRs today on news that Beijing will increase price of refined oil and electricity. Shares of China's largest oil company by market value, Petrochina (PTR), jumped $9.78 or 7.27 percent by 11:00 followed closely by Sinopec (SNP) and China's largest independent electricity provider, Huaneng Power (HNP).

We took the risk to say a month ago that “we think Chinese equities are nearing the bottom. Looking at Asia and China in particular, we find both macro and micro economic data to fuel our optimism. “ Since then the China ADR Index (CAI) rallied 7.5% in line with the Hang Seng’s 7.0% comeback, outshining the Shanghai Composite’s modest 3.7% rally. Have Chinese equities bottomed out?

LFC tripled its net profits in 2007, gaining most from the rise of equity markets, however the capital market downturn in 2008 has significantly shrunk LFC’s net profits. This has made LFC’s generic growth a key determinant to its prospects. In 2008, LFC generated a considerably increased premium income as a result of promotion of participating products and increased demand for insurance protection. This can be due to increasing awareness of insurance protection after consecutive occurrence of the natural disasters. In addition to the limited negative impacts of the earthquake, combined with a concern about the uncertainly of equity market performance, and we recommend...(you have to subscribe for premium content)

Stock markets in the U.S. continued to slug: inflation concerns and high oil kept pressure on equity markets. Tuesday's economic data illustrated how the steep run-up in energy costs this year is affecting businesses. The Labor Department data showed that producer price index jumped 1.4 percent in May, the largest increase since last November. The DJIA shed 108.78 points. The S&P 500 index, a measure of the broader market, fell 9.21 points to 1,350.93, while the Nasdaq composite index fell 17.05, or 0.69 percent, to 2,457.73.

China's largest coal miner by output reported a 13.3% increase in commercial coal production in May 2008 from a year ago. Export of Chinese coal came to a standstill in 2007 as China is struggling to feed its growing electricity demand. Nearly two-thirds of Chinese electricity is generated by unsing coal fired power plans. The winter storm related coal supply shortages just highlightened the problems facing both the cola nad the power generating industry.

We published a list of chinese stocks last week. The criteria we used was very simple: if 10 DMA was above 30DMA, a stock qualified. The result is not too rosy: stocks on average lost -6.5% between 6/6 - 6/13. Well, it is also noteable that last week was a bloodbath for Chinese stocks not just in the U.S. but worldwide. The Hang Seng Index in hog Kong lost 1,810 points from 24,402.18 points to 22,592.30. This is a 7.4% drop just in one week!

As resolved at the annual general meeting of the Company convened on 9 May 2008, it was approved to issue medium-term bonds with a total principal amount of not less than RMB3 billion and not more than RMB10 billion (the “Medium-term Bonds”). Pursuant to the approval granted by the National Association of Financial Market Institutional Investors on 22 May 2008, the Company may issue medium-term bonds with a total principal amount of up to RMB10 billion in the People’s Republic of China by various tranches effective on or before 20 May 2010.

Last week we published a study that looked at 10- and 30-day moving averages and their crossing patterns to find momentum stocks. We continue with some technical analysis today by introducing the Overbought/Oversold techincal indicator. The one we use gives investors a gauge of the market in a snapshot by laying down all Chinese ADRs on a single paper. This method makes it very easy to find stocks that are out of their normal trading characteristics; thus offering trading opportunities.

From the annual income statement, Chalco achieved major improvement in revenue, increasing from 37,826.5 million RMB in 2005 to 76,180.4 million in 2007. This significant increase was mainly due to its several acquisitions during 2006 and increasing global commodity price. The acquisitions increased the production capacity dramatically. Total revenue had increased 17.5% from 2006 to 2007. However, as the continuing strong demand from Asian countries especially from China had been pushing the sales price up, the global oil price had increased as well to push up the cost of the industry. Specifically, Chalco’s cost of revenue went up from 43,930.7 million in 2006 to 57,197.5 million in 2007, representing a 30% jump. The significant increase in cost resulted in the net income had dropped 15.6% from 11,726.5 million to 9,899.6 million. In addition, gross profit margin dropping from 32.2% in 2006 to 24.9% in 2007. Also, operating profit margin and net profit margin decreased 7.68% and 5.09% respectively during the period from 2006 to 2007.

A very dear Chinavestor client has been encouraging me to develop a filter that tracks 10-DMA and 30-DMA for Chinese ADRs and keeps track of the developemnt of such values. All basic and advanced technical tools widely used by the small investor comunity can draw charts to display the divergence between the two indicators. But the problem is that if someone wants to gauge all Chinese ADRs in the market, it takes time to visually observes each chart.

Wall Street saw better days then today. The DJIA is down over 300 points on high unemployment rate and record oil, approaching $150 a barrel. No wonder, shares of U.S. listed Chinese companies, or ADRs, follow suit measured by the broad China ADR Index or CAI. As the following table demonstrates, Chinese ADRs lost 3.41% today however there is a significant difference between NYSE and NASDAQ listed ADRs. While index heavy NYSE listed China stocks lost ground, measured by the China NYSE Index (CYI), NASDAQ listed Chinese ADRs hold ground thanks to a superb performance of NetEase (NTES), The9 and some solar companies.