Hong Kong Stock Mid-Review | Hang Seng Index fell 2.07%, dropping below 25,000 points, with the technology sector leading the decline. Alibaba and SMIC saw significant pullbacks

Market Overview

▪ On November 21, the three major indices of the Hong Kong stock market collectively declined, with the Hang Seng Index falling by 2.07% to 25,300.28 points; the Hang Seng China Enterprises Index dropping by 2.14% to 8,947.36 points; and the Hang Seng TECH Index decreasing by 3.11% to 5,401.25 points.

▪ The overall market declined, with 233 stocks rising, 1,592 stocks falling, and 901 stocks closing flat, reflecting a lack of market sentiment and a rapid cooling of investor risk appetite.

▪ Funds favoring large-cap leaders significantly withdrew from high-position track stocks, putting pressure on high beta sectors, with layouts gradually shifting towards policy beneficiaries.

Sector Performance

▪ The technology sector led the market decline today, with the Hang Seng TECH Index showing the most significant drop. Representative leader Alibaba fell by 4.07%, and SMIC plummeted by 5.31%. Although there was a phase of rising demand for AI and chips previously, today, main funds concentrated on outflows, applying pressure on performance-sensitive leaders, indicating a reduced willingness for short-term allocation.

▪ The real estate development sector performed strongly, driven by favorable policies, with a slight overall increase, reflecting that market funds are seeking a safety cushion at the policy bottom, with a phased allocation towards the real estate chain to bet on rebounds. Funds tend to prefer targets with stable performance and policy benefits.

▪ The pharmaceutical sector saw a moderate increase, with recent news of innovative drug approvals driving orderly inflows of funds. The market is focusing on structural opportunities within the sector, with some leaders recording moderate gains and increasing trading activity.

Macroeconomic Background

▪ From a macro perspective, the latest data shows that Hong Kong's retail, export, and import momentum is moderate, the unemployment rate has decreased to 3.8%, the manufacturing PMI has risen to 51.2, foreign exchange reserves remain stable, and overall money supply is steady.

▪ Currently, inflationary pressures are low, and signs of economic recovery continue, but investors are concerned about consumption and export performance as well as policy changes, which are having a phased impact on market risk appetite. Capital allocation is trending towards structurally policy-beneficial directions.

Top 10 Market Turnover

▪ Alibaba -W (9988.HK) latest transaction price HKD 148.50, down 4.07%, turnover HKD 12.204 billion

▪ Xiaomi Group -W (1810.HK) latest transaction price HKD 37.40, down 0.80%, turnover HKD 9.458 billion

▪ Tencent Holdings (700.HK) latest transaction price HKD 611.00, down 1.61%, turnover HKD 5.921 billion

▪ SMIC (981.HK) latest transaction price HKD 69.60, down 5.31%, turnover HKD 4.097 billion

▪ Meituan -W (3690.HK) latest transaction price HKD 95.45, down 3.10%, turnover HKD 2.082 billion

▪ Pop Mart (9992.HK) latest transaction price HKD 193.80, down 3.77%, turnover HKD 1.964 billion▪ Hua Hong Semiconductor (1347.HK) latest transaction price HKD 73.85, down 5.32%, transaction amount HKD 1.688 billion

▪ Contemporary Amperex Technology Co., Limited (3750.HK) latest transaction price HKD 462.40, down 4.27%, transaction amount HKD 1.663 billion

▪ Ping An Insurance (2318.HK) latest transaction price HKD 56.90, down 2.32%, transaction amount HKD 1.470 billion

▪ Hong Kong Exchanges and Clearing Limited (388.HK) latest transaction price HKD 409.80, down 1.87%, transaction amount HKD 1.331 billion