Chinese ADRs are trading mixed today with Baidu.com (BIDU) taking the lead and Sohu.com (SOHU) taking a beating. Easing oil prices helped spur the DJIA to 11,315.00 points by 1:00 P.M. Lowering demand for the black gold became obvious today when statistics showed that U.S. drivers drove 3.5% less miles than last year, the biggest ever drop for the measure during the busy summer holiday season. Customs data showed that demand for oil dropped by 891,000 barrels in June vs. May, a sign that high price of oil is unsustainable. Many expect crude to come back to the $100 level within reasonable time. The greenback strengthened against both the Euro and the yen, adding fuel for the slide in the oil price. Looking at the U.S. listed Chinese stock universe, Baidu.com is shining the brightest today so far. China's premium search engine company is up $4.06 or 1.21% by 1:00 P.M., continuing a rally that seems to have no end. The price of the stock is up 17.8% since June 23 (chart here) when the company announced better then expected second quarter results plus a positive guidance for the upcoming quarter.

Chinese ADRs are trading mixed today after the lunch with NASDAQ listed names shining more. Baidu.com, China's premium search engine company, is up $7.15 or 2.15% at $339.55, extending gains from last week following better-then-expected earnings. As the following table testifies, large cap NYSE listed Chinese ADRs are pulling down the China ADR Index (CAI). The index lost 24.4% year-to-date (YTD) with notable difference between NASDAQ and NYSE listed ADRs. While the market cap weighted overall index lost almost 15% YTD, NASDAQ listed Chinese ADR Index or CQI holds up much better by shedding -15.4% YTD. This performance is not much different then major U.S. indices themselves.

Fourth week of July was the week we've been long waiting for. Price of oil tumbled while Wall Street ended the week on a high note. Chinese companies listed on American exchanges performed well, too. As the following summary table of the Chinese ADRs listed on the NYSE and NASDAQ suggests, double digit gains were quite common - see column 5 market "change". In fact China's premium search engine company, Baidu.com (BIDU), rallied $40.86 since last Friday in just five trading days. The company announced 2008 Q2 earnings on July 23 after the close sending its shares remarkably higher the next day and breaking through the $300 resistance level.

China's largest independent power generator, Huaneng Power (HNP), announced the issuance of the first batch of a total of RMB10 billion ($1.46 billion) short-term debt. Bank of China acts as primary underwriter. Considering that all major publicly traded Chinese power generators- Huaneng Power, Datang Power and Huadian Power - are in the red due to high thermal coal prices, the announcement from Huaneng shouldn't come as a surprise. On the other hand considering that total current debt for the company is RMB 31 billion, the additional RMB 10 billion is a very substantial increase. On the other hand, as the following table suggests, the company is not over-leveraged and can take on some more debt. Quick and current ratios, measuring short-term liquidity - are just average but the company looks attractive from a liquidity perspective when it comes to a long-term examination.

Datang Power, one of the largest independent power generating companies in China, reveled today that due to high coal prices during the first six months of 2008 the company is expected to swing to a loss. Based on documents submitted to the Hong Kong Stock Exchange, management of the company expects profits to drop by 70% vs. same period last year. Datang Power is feeling the pinch from high thermal coal prices, just as other Chinese power companies do. Similar announcement was made by Huaneng Power (NYSE:HNP) last week and Huadian Power is expected to announce similar earning warning.

Datang Power, one of the largest publicly traded independent power producer in China, today announced on- and off-grid power tariff changes effective July 1, 2008. Chinese regulators let gasoline and diesel prices to increase on June 20th and announced plans tht power generators will be allowed to increase tariffs, also. Datang Power acted accordingly and increase the average on-grid tariff by 17.7 Yuan/MWh representing an increase of 5.23 percent.

China Eastern Airlines Co. Ltd (NYSE:CEA) is the stock of the day when it comes to Chinese ADRs. The stock is the biggest winner of the day by a heafty 8.76% gain or $2.79. In dollar terms only Sohu.com (SOHU) does better today by trading $3.87 higher than yesterday's close. One obvious reason for strenght within China's aviation industry is falling crude oil pirces. since kerosene makes up well over 50% of all costs for airliners, lower prices mean better margins and profitability. The stock got additional boost from rumors that China Eastern Airline (CEA), China's third largest after China Southern Airline (ZNH) and Air China (0753.HK), is considering a cooperation or a possible merger with her arch rival in Shanghai, Shanghai Airlines (上海航空).

Pursuant to Rule 13.43 of the Rules Governing the Listing of Securities on The Stock Exchange of Hong Kong Limited and as announced on 3 March 2008, a meeting of Directors of HSBC Holdings plc will be held on Monday, 4 August 2008 to consider the announcement of the interim results for the six months to 30 June 2008 and the declaration of the second interim dividend for 2008. In accordance with the Rules Governing the Listing of Securities on The Stock Exchange of Hong Kong Limited the announcement will be released on Monday 4 August 2008 after the stock index futures and options market in Hong Kong closes for trading at 4.30pm (9.30am London time).

Aluminum Corp. of China (ACH) shed another $.30 today to close at $27.39, a 52 week low. What's wrong with the company when aluminum prices are hitting records at the London Metal Exchange? The problem is not aluminum but alumina. There is significant overcapacity and Chalco is partially to blame for it. So one of our analyst looked into supply and demend of aluminum and more importantly, alumina. here she comes.

1. Strong Advertising Business Growth In Q1 2008, SINA delivered a growth of 51% yoy in its advertising revenue to 47.8 million dollars. The Olympic Games is the main driver of the increases in the adverting revenue, especially in Q3 2008. In the post-Olympic Games period, it is likely that the growth rate will drop to a lower level. Sohu, the biggest Internet firm on the mainland expects core advertising revenue to grow up to 45 percent this year, but it warned the growth may taper off to about 20 to 30 percent in 2009. As the advertising revenue of SINA represented over 60% of total revenue in Q1 2008 and 69% for year 2007, the large drop will adversely affect the performance of SINA in 2009.

Oil came back $2.16 to settle at $131.04 at the New York Mercantile Exchange sending investors to cash in previous gains. Bank of America reported better-than-expected losses following similar announcements from Citigroup, JP Morgan & Chase and Wells Fargo. Some take this as if the worst is over however earnings prospects are soft for many industry leaders such as Merck and Schering-Plough Corp. Despite weakness in the U.S. markets shares of Chinese companies listed in the U.S. ended the day on a high note. The overall China ADR Index (CAI) gained 14.38 points today with NASDAQ listed Chinese ADRs outperforming their NYSE counterparts.

Business Overview The9 Limited, incorporated in December 1999, is a leading online game operator in China. As of March 31, 2008, The9 City had close to 38.1 million registered users. The Company’s business is primarily focused on operating massively multiplayer online role-playing games (MMORPGs). Its major products include: - Affiliates operating licensed games, e.g. World of Warcraft (WoW), MU, Soul of The Ultimate Nation (SUN) and Granado Espada (GE). - The proprietary MMORPG, e.g. Joyful Journey West and Warriors of Fate Online. - Other exclusive licensed MMORPGs and advanced casual games, e.g. Hellgate: London, Ragnarok Online 2, Emil Chronicle Online, Huxley, FIFA Online 2, Audition 2, Field of Honor, Audition and Atlantica. - Other Products and services, include game operating support, website solutions and advertisement services, short message service (SMS), sales of its Pass9 system, and licensing of its games to third parties.