2024.06.17 08:46
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Hong Kong Stock Market Closing (06.17) | Hang Seng Index Slightly Down 0.03% Apple Concept, Semiconductor Stocks Active BYD ELECTRONIC Leads Blue Chips

Hong Kong stocks closed with the Hang Seng Index slightly down by 0.03%, with active trading in Apple concept and semiconductor stocks. BYD ELECTRONIC led the blue chips with a 6.32% increase. Mengniu Dairy, SMIC, XinAo Energy, and China Resources Beer performed poorly. The market may be in a short-term consolidation phase

According to the Wise Finance APP, the Hong Kong stock market opened lower in the morning and then rose, with the Hang Seng Index and the H-share index both rising more than 1% at one point. However, they subsequently fluctuated and turned green towards the end of the session, with only the Hang Seng Tech Index closing slightly higher. As of the close, the Hang Seng Index fell by 0.03% or 5.66 points to 17,936.12 points, with a total daily turnover of 96.324 billion Hong Kong dollars; the Hang Seng China Enterprises Index fell by 0.02% to 6,373.48 points; and the Hang Seng Tech Index rose by 0.05% to 3,709.35 points.

CICC pointed out that while policies are still expected to continue to be introduced, "strong stimulus" is not realistic, so the market may show more of a short-term consolidation trend. Among the three main drivers of the market, risk premiums have been largely restored, there is limited short-term room for risk-free interest rates to move, and earnings are the key to unlocking greater market potential, but this is highly dependent on the opening of the credit cycle. Therefore, until more catalysts emerge, the market may continue to fluctuate at its current level (around 18,000 points for the Hang Seng Index).

Performance of Blue Chip Stocks

BYD Electronic (00285) led the blue chips. By the close, it rose by 6.32% to 39.55 Hong Kong dollars, with a turnover of 8.53 billion Hong Kong dollars, contributing 2.95 points to the Hang Seng Index. Huachuang Securities research report pointed out that the company is looking forward to a significant breakthrough in AI business revenue, while its main automotive electronics business is backed by its parent company BYD Co., Ltd. It is currently forecasted that net profits for the years 2024 to 2026 could reach 5.069 billion, 7.063 billion, and 8.231 billion yuan respectively.

As for other blue chip stocks, China Mengniu Dairy (02319) rose by 2.98% to 13.14 Hong Kong dollars, contributing 1.92 points to the Hang Seng Index; SMIC (00981) rose by 2.61% to 18.08 Hong Kong dollars, contributing 3.09 points to the Hang Seng Index; XinAo Energy (02688) fell by 3.47% to 66.75 Hong Kong dollars, dragging down the Hang Seng Index by 3.05 points; China Resources Beer (00291) fell by 3.11% to 29.55 Hong Kong dollars, dragging down the Hang Seng Index by 2.46 points.

Hot Sectors

On the market, most large-cap tech stocks turned higher, with Meituan rising by nearly 2% and Kuaishou rising by over 1%. Reports indicated that Apple plans to develop a thinner model for the iPhone 17 series, leading to gains in Apple concept stocks; it was also reported that TSMC plans to raise prices, resulting in a general rise in semiconductor stocks today. On the other hand, residential property prices in various first-tier cities in May continued to adjust, leading to a collective decline in property stocks; expectations of peak summer electricity demand have not materialized, leading to an expanded decline in coal stocks in the afternoon; gas stocks, power stocks, shipping stocks, and oil stocks all generally showed weakness.

1. Apple concept stocks lead the gains . By the close, GoerTek Inc. (01415) rose by 8.3% to 24.15 Hong Kong dollars; BYD Electronic (00285) rose by 6.32% to 39.55 Hong Kong dollars; Sunny Optical Technology (02382) rose by 2.16% to 49.75 Hong Kong dollars; and Q Technology (01478) rose by 0.24% to 4.21 Hong Kong dollars Apple unveils AI strategy, integrating its new "Apple Intelligence" technology into a range of applications including Siri, and partnering with OpenAI to bring ChatGPT to devices like the iPhone. Apple is also advancing the integration of large-scale models from other companies, which is expected to boost future sales of iPhone, iPad, and Mac computers. Additionally, according to Securities Times, there are rumors that Apple is developing a thinner iPhone model, aligning with previous rumors about the new iPhone 17 Slim model. CICC points out that Apple Intelligence supports upgrades for iPhone 15 Pro series and above, potentially significantly increasing user demand for upgrades and driving up Apple's sales. The AI user experience is expected to further drive user upgrades, benefiting the domestic Apple supply chain.

2. Semiconductor stocks generally rise. As of the close, SMIC (00981) rose by 2.61% to HKD 18.08; Shanghai Fudan (01385) rose by 2.58% to HKD 13.5; Hua Hong Semiconductor (06908) rose by 1.23% to HKD 0.41; Huahong Semiconductor (01347) rose by 1.08% to HKD 23.5.

According to media reports, TSMC plans to raise prices. The price increase for 3nm foundry services may be over 5%, and advanced packaging annual pricing is expected to increase by about 10%-20%. TSMC's 3nm production capacity is fully booked by seven major clients including Apple and NVIDIA, with demand outstripping supply, and orders expected to be full until 2026. In addition, some industry insiders have stated that SMIC, Huahong, and other wafer fabs have been operating at full capacity for several months, with no willingness to negotiate price reductions in the near future. Furthermore, industry sources have mentioned that while terminal demand has somewhat recovered this year, there have not been significant fluctuations overall. However, since March, driven by AI computing power and urgent orders from several major factories, there has been a surge in demand for high-volume and wide-ranging products, leading to tight capacity at leading wafer fabs.

3. Real estate stocks collectively decline. As of the close, Shimao Group (00813) fell by 8.24% to HKD 0.78; China Oceanwide Holdings (03377) fell by 8.08% to HKD 0.455; Sunac China (01918) fell by 6.35% to HKD 1.18; China Vanke (02202) fell by 4.15% to HKD 5.08.

Data from the National Bureau of Statistics shows that in May, among 70 large and medium-sized cities, the prices of newly built residential properties in various tier cities decreased month-on-month, with a slightly expanded year-on-year decline. In May, the selling prices of newly built residential properties in first-tier cities decreased by 0.7% month-on-month, expanding by 0.1 percentage point compared to the previous month. In May, the selling prices of newly built residential properties in first-tier cities decreased by 3.2% year-on-year, expanding by 0.7 percentage point compared to the previous month; while the selling prices of second-hand residential properties decreased by 9.3% year-on-year, expanding by 0.8 percentage point compared to the previous month Chief Researcher Li Yujia of the Guangdong Housing Policy Research Center believes that the increase in the price drop of new houses is largely influenced by factors such as pressure on new house sales and tight funding chains for developers, forcing real estate companies to offer discounts to achieve higher sales volumes.

4. Afternoon Decline in Coal Stocks. As of the close, Nan Gobi (01878) fell by 9.39% to HKD 3.28; Yanzhou Coal Mining (01171) fell by 3.86% to HKD 17.42; China Coal Energy (01898) fell by 3.67% to HKD 9.44; Yancoal Australia (03668) fell by 2.81% to HKD 31.15.

As of June 14th, the market price of Qinhuangdao Port Power Coal (Q5500) from Shanxi was 872.0 yuan/ton, a week-on-week decrease of 3.0 yuan/ton. Sinolink Securities believes that coal prices are still in a volatile state, and the expectation of peak summer demand has not been met. In mid-June, the Jiangnan, South China, and Southwest regions continued to experience heavy rainfall, with accumulated precipitation 3-7% higher than the same period in previous years, and daily coal consumption at coastal power plants rising slowly. On the eve of the peak summer demand, traders have positive expectations for the future market, coupled with the continuous inversion of shipping costs, traders are still holding prices up. The bank predicts that in the short term, coal prices will remain volatile, and with the rising temperatures in most coastal cities, end-user daily consumption may rebound from a low level, potentially driving coal prices to fluctuate upwards.

Top Stocks on the Move

1. China Huarong (01114) Strong Performance Throughout the Day. As of the close, it rose by 18.79% to HKD 8.47.

Morgan Stanley's research report pointed out that the company declared a special dividend of HKD 4.3 per share, exceeding the market and the bank's expected HKD 1.5 per share, with a total annual dividend of HKD 5.8 per share, compared to the bank's previous expectations of HKD 5.6 per share for 2024 and 2025. The bank has a "hold" rating with a target price of HKD 8.2.

2. Ascentage Pharma-B (06855) Hits a New High in the Development Stage. As of the close, it rose by 17.14% to HKD 27.

Ascentage Pharma issued 24.3073 million new shares to independent third party Takeda International, equivalent to a 7.73% increase in enlarged share capital, with a lock-up period of one year; the total consideration is USD 75 million (approximately HKD 5.86 billion), equivalent to a price of HKD 24.0985 per share, a premium of 4.55% over the closing price on June 14th. The net proceeds will be used for the development of core products and key candidate products