The first step in stock trading is to open a stock account. On August 15th, the Hong Kong stock market experienced increased intraday volatility, yet it remained within its range-bound pattern. The Hang Seng Index closed slightly down by 4 points at 17,109, marking the fifth consecutive trading day around the 17,000 level. The Hang Seng Tech Index also edged down by 0.3%, closing at 3,384. The total transaction value increased to over 87.
9 billion Hong Kong dollars, primarily due to the increased trading volume of the Stock Connect, although the overall market transaction volume is still considered low. The Stock Connect recorded a net inflow of 6.635 billion Hong Kong dollars, with a focus on purchasing index ETFs, possibly aiming for short-term trading opportunities. Amid a quiet market, existing funds returned to central state-owned enterprises with higher dividend yields, such as banks, telecommunications, energy, and public utilities. Notably, the stock prices of ICBC (1398 HK), CCB (939 HK), and ABC (1288 HK) each set or approached 52-week highs, and the stock prices of the three major telecommunications operators also rose for three consecutive trading days. Tencent (700 HK), which recently announced better-than-expected adjusted profits for the second quarter, saw its stock price fall by 1.5%, potentially influenced by cautious guidance from management. According to Zhongtai International, July’s economic data for China show that prices continue to operate at a low level, credit demand is weak, consumption growth is slowing, real estate sales remain under pressure, and there is a risk of downward revision to Hong Kong stock earnings forecasts. However, the stabilization of overseas market trends and the historically low valuation of Hong Kong stocks are conducive to the gradual stabilization of the market. The extremely low transaction volume of Hong Kong stocks may also indicate an imminent change. In the past two weeks, the performance of Hong Kong’s internet giants has been densely released, coinciding with the dense release of Sino-American economic data this week, leading the market to temporarily adopt a wait-and-see attitude. Macro dynamics: China’s July consumption, fixed investment, and industrial production data show mixed performance, with economic downward pressure remaining significant. The year-on-year growth rate of retail sales in July was +2.7%, an increase from June, but after excluding the base effect, the three-year average growth rate of retail sales slowed to 2.6%, and the three-year average growth rate of goods also slowed to 2.3%. Catering, automobile, and service retail have all noticeably slowed down or declined. From January to July, the year-on-year growth rate of fixed investment was +3. 6%, slightly better than expected, with manufacturing and infrastructure continuing to be the main pillars, while real estate investment continues to drag significantly. In July, the sales area and sales volume of commercial housing fell by 11.6% and 15.8% year-on-year, respectively, with a sequential decline of over 40%. After the real estate companies’ mid-year rush in June, the housing market pressure returned in July. In July, the new construction and completion areas of housing fell by -19.5% and -22.3% year-on-year, respectively. Although the year-on-year decline narrowed compared to June, the absolute values are still at a relatively low level, indicating that real estate companies lack the willingness to start construction against the backdrop of weak terminal sales.Industry Trends: In the consumer sector, luxury brand Samsonite (1910 HK) saw a single-day drop of 8.9%, with its stock price falling to a 52-week low. The company’s Q2 revenue was below the management’s previous guidance of 6%-8%, growing only 1.5% year-on-year. The underperformance was mainly due to the weak Chinese market and price wars in India; Q2 EBITDA fell by 3.1% year-on-year. Additionally, due to continued weak consumer sentiment in Q3, management has revised the full-year revenue forecast to low single digits, leading the market to believe the company will face short-term profit pressure. The company’s single-day trading volume reached a 3-month high.
In the new energy vehicle sector, the performance of parts company Nexteer (1316 HK) was affected by foreign exchange fluctuations, one-time events, impairments, and increased tax rates, with net profit falling by 54% year-on-year, below expectations. The company also revised its full-year growth target to 1%. Its stock price fell by 18% in a single day, setting a historical low, and trading volume reached a 6-month high. In the healthcare sector, the Hang Seng Healthcare Index rose by 0.86% yesterday. China Biologic Products (1177 HK), which reported better-than-expected interim results, continued to climb by 5.63%. Clinical trials have shown that Ronchang Bio’s (9995 HK) main product, Tyvaso, can continuously improve the symptoms of patients with generalized myasthenia gravis, reaching the main endpoint of phase III clinical trials, and Ronchang Bio’s stock price increased by 2.14%. Zhongtai International expects Ronchang Bio to have a good operational performance in the first half of the year, and Tyvaso’s main indication, lupus, is a rare autoimmune disease that can lead to death, with few competitors, thus Tyvaso’s long-term demand potential. In the internet sector, Tencent Holdings (700 HK) performed well in Q2, with revenue and net profit attributable to shareholders increasing by 8% and 82.0% year-on-year, respectively. Thanks to the successful launch of several popular games, the value-added services revenue, which accounts for nearly half of the total revenue, increased by 6% year-on-year, and the gross margin of this business increased from 54% to 57%, driving the company’s revenue and profit growth. The company’s stock price fell by 2.7% over the past two days, possibly due to the market’s prior expectation of good Q2 results and a subsequent pullback after the stock price had risen consecutively. In the utilities sector, Cheung Kong Infrastructure (1038 HK) announced that it has applied for a secondary listing on the London Stock Exchange, expected to be approved on August 19 at 8:00 AM (BST). The UK is the company’s main source of business. If joint ventures and associated companies are also considered, it is estimated that the UK accounts for about half of the company’s profits. This secondary listing can attract UK and overseas investors to participate, enhance the diversification of the company’s investor base, and support valuation in the long term.The company’s stock price increased by 1.2% yesterday, reaching a 52-week high at one point. After two days of gains, the virtual asset ETF fell back yesterday, with Hong Kong spot Bitcoin and Ethereum ETFs declining by approximately 3.9%-4.7%. Bitcoin and Ethereum each dropped from $61,000 and $3,750 to levels around $58,000 and $3,600, respectively. In terms of news, (1) the U.S. government transferred 10,000 units of Bitcoin seized from the defunct dark web Silk Road to a cryptocurrency trading platform, potentially for sale; (2) Salim Ramji, CEO of the world’s leading ETF issuer Vanguard Group, stated that there are no plans to engage in cryptocurrency ETF business, and the company will not follow the models of other financial institutions.
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