Hong Kong Stock Market Closing (07.18) | Hang Seng Index Rose by 0.22%, Most Concept Stocks Rebounded, NONGFU SPRING Soared by 6% Leading Blue Chips

According to the information from the Wise Finance app, the Hong Kong stock market rose in the morning session, then fell back, and then climbed again, with the Hang Seng Index and the National Index turning red successfully. The afternoon saw an expansion in the gains. Among the three major indices, only the Hang Seng Technology Index fluctuated below the waterline all day. As of the close, the Hang Seng Index rose by 0.22% or 39 points to 17,778.41 points, with a total daily turnover of HKD 87.536 billion; the Hang Seng China Enterprises Index rose by 0.15% to 6,306.8 points; and the Hang Seng Technology Index fell by 0.76% to 3,613.13 points.

CITIC Securities pointed out that looking ahead to the second half of the year, the bank believes that the sustainability of the market is still worth looking forward to, and the upward drive is expected to gradually switch. The expectation of domestic macroeconomic recovery is expected to become the main driver of the beta market. In terms of overseas liquidity, the bank is pleased to see the Fed cut interest rates in September. The improvement in the overseas interest rate environment will drive the repair of the denominator logic of Hong Kong stocks. However, even if the Fed's interest rate cut process is lower than expected again, the negative disturbance to Hong Kong stocks may still be limited.

Performance of Blue Chip Stocks

Nongfu Spring (09633) led the blue chips. As of the close, it rose by 6.48% to HKD 35.35, with a turnover of HKD 9.19 billion, contributing 7.01 points to the Hang Seng Index. The Consumer Council of Hong Kong clarified today the earlier bottled water test report, apologized to Nongfu Spring, and pointed out that after in-depth research, it was believed that the test caused misunderstandings due to the classification of samples. The sample was reclassified as an independent category "drinking natural water" and re-evaluated, with the overall performance of the sample increasing from 4.5 stars to 5 stars.

In other blue chip stocks, China Hongqiao (01378) rose by 3.55% to HKD 10.5, contributing 1.64 points to the Hang Seng Index; China Communications Construction (01038) rose by 2.92% to HKD 51.05, contributing 1.45 points to the Hang Seng Index; Sands China (01928) fell by 1.96% to HKD 16.02, dragging down the Hang Seng Index by 1.46 points; Sunny Optical Technology (02382) fell by 1.78% to HKD 49.65, dragging down the Hang Seng Index by 1.04 points.

Hot Sectors

On the market, large technology stocks are generally under pressure, with Tencent, Alibaba, and others falling. Tourism and sightseeing, gaming, Apple concept stocks, and automotive stocks are all declining. On the other hand, most of the China Railway concept stocks rebounded, with national railway investment hitting a new high in the first half of the year. High-speed rail construction stocks performed strongly, with active telecommunications stocks, oil stocks, etc.; spot gold rose in the short term, and gold stocks hit bottom and rebounded; home appliance stocks, wind power stocks, photovoltaic stocks, and gas stocks generally rose.

1. Rebound of Some China Railway Concept Stocks. As of the close, China Aerospace Science and Industry (02357) rose by 5.08% to HKD 3.72; China Railway Signal & Communication (03969) rose by 4.29% to HKD 3.4; China Telecom (00728) rose by 1.94% to HKD 4.74; CNOOC (00883) rose by 1.89% to HKD 21.55.

Guohai Securities pointed out that the valuation of central state-owned enterprises has the foundation and possibility of continuous improvement. Against the background of deepening reforms, state-owned enterprises have strong profitability resilience, continuously expanding high-quality asset financing channels, playing a key role in stabilizing the capital market, and fulfilling their responsibilities as the cornerstone of economic development well At the same time, the China Securities Regulatory Commission is promoting the reform of state-owned enterprises' dividend distribution, with the willingness and ability of state-owned enterprises to distribute dividends significantly increasing, highlighting the advantages of state-owned enterprises. The profit quality of undervalued state-owned enterprises is steadily improving, and the main line of undervalued central state-owned enterprises is gradually being realized.

2. Gold stocks hit bottom and rebound. As of the close, Lingbao Gold (03330) rose by 3.61% to HKD 3.73; Zhaojin Mining (01818) rose by 1.91% to HKD 16.02; Shandong Gold (01787) rose by 1.23% to HKD 18.04; and China Gold International (02099) rose by 1.07% to HKD 52.

Spot gold rose in the short term during the day, retesting the $2470 per ounce level, with an intraday increase of over $14. Prior to this, after hitting a new historical high of $2483.60 per ounce, gold prices saw profit-taking and ended lower by 0.41%. Guomao Futures believes that in the short term, with the interest rate cut in September approaching 100% and the trend of gold prices showing some upward momentum after hitting a historical high, the prices of precious metals may continue to be relatively strong in the short term. Huafu Securities also pointed out earlier that the risk aversion sentiment brought about by the short-term U.S. political elections, as well as the worsening U.S. fiscal deficit and market concerns about the U.S. dollar credit, indicate that the upward trend in gold prices is not over.

3. Photovoltaic stocks are generally rebounding. As of the close, Flat Glass (06865) rose by 3.02% to HKD 11.6; Fuyao Glass (03606) rose by 2.3% to HKD 46.75; Xinyi Solar (00968) rose by 1.62% to HKD 3.77; and New Energy (01799) rose by 0.26% to HKD 7.86.

The National Energy Administration has requested reasonable guidance on the construction and release of photovoltaic upstream capacity to avoid redundant construction of low-end capacity. Zhongyuan Securities pointed out that based on the disclosed mid-term performance forecasts, the mid-term performance of various links in the photovoltaic industry will see a significant decline or widespread losses. Layoffs, shutdowns for maintenance, and production stoppages in the photovoltaic industry have occurred successively, with industry capacity reduction in progress. Currently, photovoltaic product prices have fallen below costs, and various links in the main industry chain are facing significant profit pressures, which will accelerate industry reshuffling. The valuation of the photovoltaic sector is at a historical low. In the short term, individual photovoltaic stocks in the secondary market are showing oversold rebound trends, but a reversal of the trend still requires fundamental support.

Hot Movers

1. Aito (01274) surged significantly. As of the close, it rose by 18.75% to HKD 31.35.

In response to the abnormal price fluctuations yesterday, Aito issued an announcement stating that after reasonable inquiries, it confirmed that it was not aware of any reasons causing such unusual fluctuations in the stock price and trading volume. As of the date of this announcement, the company's operations are normal, and the board of directors is fully confident in the future development prospects of the group.

2. Leapmotor (01497) hit a new high, rising by 11.48% to HKD 12.82 as of the close. Yanzhiwu released its performance announcement, expecting a revenue of approximately RMB 1.045 billion to 1.09 billion in the first half of the year, a year-on-year growth of about 10% to 15%; the estimated net profit is about RMB 50 million to 60 million, a decrease of about 40% to 50% compared to the same period in 2023.

3. Hope Education International Holdings (01765) Soars on High Volume, closing up 9.69% at HKD 0.215.

Hope Education International announced a restructuring of overseas liabilities. Considering the current financial situation and feedback from identified creditors, the company has drafted preliminary terms for proposed restructuring to further discuss with its creditors. The company emphasized its commitment to fully repay creditors and has no intention to deduct the outstanding amount of related bonds.

4. Times Electric (03898) Announces Profit Surge, closing up 2.88% at HKD 28.55.

Times Electric announced that it expects a net profit attributable to the owners of the parent company of approximately RMB 1.507 billion in the first half of 2024, a year-on-year growth of 30.56%. Revenue growth benefited from increased railway investment, passenger flow recovery, positive impacts such as growth in the acceptance and delivery volume of rail transit products