Be warned ! …. the Ting Hai (丁蟹) effect may kick in
*Saving General Yang — comes out on 4 April 2013
If you think that the weaker than expected China Manufacturing PMI (official figures or those of HSBC) released in Asian morning were the catalysts for the risk off move lower in Asian stocks and AUD FX …. wait till the ”Ting Hai (丁蟹) effect” kicks in if this time is no different from the past!
The person and event to watch is Adam Cheng Siu-chow. Whenever Cheng’s films hit movie and TV screens, the Hang Seng index tends to collapse. Cheng’s next movie — Saving General Yang — comes out on 4 April 2013.
Cheng had shows airing during the Asian financial crisis of 1998 and the tech bubble burst of 2000. The market fell during 11 of 17 of his television shows since 1992. It seems that the markets do worse when the series / shows are more tragic. (*Do note that Saving General Yang is pretty gory and tragic!).
This phenomenon is called the ”Ting Hai (丁蟹) effect” http://en.wikipedia.org/wiki/Ting_Hai_effect named after one of Cheng’s characters who makes money by shorting derivatives and stocks.
Check out the unbelievable statistics of the market risk off downturn from Adam Cheng:
1990s
- October 1992: The drama series Greed of Man made its debut on TVB. During the time it was broadcast, the Hong Kong’s Hang Seng Index dropped 598 to 600 points
- November 1994: Instinct (笑看風雲) made its debut on TVB. The Heng Sang Index fell more than 2,000 points.
- September 1996: Once Upon a Time in Shanghai (新上海灘) premiered on TVB. The Hang Seng Index fell 300 points.
- June 1997: Cold Blood Warm Heart (天地男兒) made its debut on TVB. The Hang Seng Index accumulated 735 points in losses.
- December 1997: Legend of Yung Ching (江湖奇俠傳) was followed by a fall of 1.4% in the Hang Seng Index.
- June 1999, Lord of Imprisonment (神劍萬里追) was followed by a fall of 6.5% in the Hang Seng Index.
2000s
- September 2000: A loose sequel of The Greed of Man, Divine Retribution aired on ATV. Due to the Tech stock bubble at the time, the Hang Seng Index fell an accumulated 1,715 points, with other stock markets around the world falling as a result also.
- March 2004: Blade Heart (血薦軒轅) premiered in Hong Kong, the Hang Seng Index fell 550 points over 3 days due to high oil prices and instabilities in the Middle East.
- October 2004: The Conqueror’s Story (楚漢驕雄) premiered in Hong Kong, followed by a 198-point drop in the Heng Seng Index on the day of the premiere.
- March 2005: The Prince’s Shadow (御用閒人) broadcast of the first episode, the Hang Seng dropped 100 points by noon, then rose back 90 points by the end of the day.
- July 2007: Return Home (香港傳奇-榮歸) broadcast and the market to fell 1,165 points.
- March 30, 2009: The King of Snooker (桌球天王) premiered in Hong Kong. The Heng Seng Index fell 663.17 points.
Asianmacro is not superstitious by nature and correlation does not infer causality. However if a sufficient number of people choose to believe in this mumbo jumbo ”Ting Hai (丁蟹) effect”, it might just become a self fulfilling prophecy and the markets de-risk taking on a larger life of its own …..
*Asianmacro is a beach bum managing his own wealth. Besides deciding what to have for lunch (or hitting the gym sometimes), he is mostly found listening to loud music while trading and investing for himself. While every care has been taken in preparing the information in and/or materials, such information and materials are provided “as is” without warranty of any kind, either express or implied. In particular, no warranty regarding accuracy or fitness for a purpose is given in connection with such information and materials. The opinions expressed do not constitute investment advice and independent advice should be sought where appropriate. In no event will Asianmacro be liable to you for any direct or indirect or any other damages of any kind arising from or in connection with your reliance on any information in and/or materials attached herewith. Asianmacro may already have or intend to have a trading or investment position in the financial instruments or products referred to in this communication. This is not intended as an offer or solicitation for the purchase or sale of any financial instrument and Asianmacro may also have interests different from or adverse to your interests.
S&P500 June 2013 futures if close below 1548 will be certainly bearish and pick up more momentum on the downside. The U.S. ISM Manufacturing & ISM Prices paid were weaker than expected on release in U.S. hours and follows the disappointment with China figures earlier in Asian trading. Hang Seng was closed on Monday 1st April on holiday, and if it opens on Tuesday 2nd April with gap down and stay below 22189, we should be looking at downside next target of 21775, which is about 524 points lower from last closing level before Easter weekend of 22299.
Nikkei led the way up and now will lead the way down.
Can’t boost a stock market by just the currency when the products are not there !
OK, for all the believers and who are short HSI and making money (*this is the most important bit! …. who cares about those at the sideline laughing at us right!) … HSI April futures is now at 21849, almost -500 points lower 😉 …. Let’s keep our fingers crossed and see what U.S. employment report holds later!
HSI April futures is -622 points & counting !!!! Looks like Adam Cheng does not fail to disappoint again … 3 cheers to that chap! On a more sombre note, it is unfortunate that the latest bout of China Bird Flu deaths is the negative catalyst driving further losses in HSI. Asianmacro has made another post on this Bird Flu at https://tradehaven.me/2013/04/05/bird-flu-better-be-worried-how-can-singapore-stock-market-be-unconcerned/ … For those of us in Asia … Let’s keep ourselves safe in health and also in our portfolios!