Market Review: The Hang Seng Index fluctuates upward, Tencent and Kuaishou under pressure, commodity stocks rebound

After the Hang Seng Index fell for two consecutive trading days, dropping 1,192 points or 4.3%, it rose repeatedly today. Driven by traditional economic cycle stocks, the Dow Jones and Nasdaq in the US rose 1.1% and 0.6% respectively overnight. At the time of writing, the yield on the US 2-year Treasury bond rose to 3.582%, and the yield on the US 10-year Treasury bond rose to 4.283%, while the US dollar index fell to 97.46. The latest Dow futures rose 22 points or 0.04%, and the latest Nasdaq futures rose 151 points or 0.6%. The Shanghai Composite Index rose 51 points or 1.3% to close at 4,067 points, the Shenzhen Component Index rose 2.2%, and the ChiNext Index rose 1.9%, with a total trading volume of 2.54 trillion RMB in the Shanghai and Shenzhen markets.

The Hang Seng Index opened 220 points higher, initially rising 350 points to a high of 27,126 points before declining, at one point falling 343 points to a low of 26,431 points. Before noon, it regained lost ground, closing up 59 points or 0.2% at 26,834 points; the Hang Seng China Enterprises Index fell 27 points or 0.3% to close at 9,053 points; the Hang Seng Tech Index fell 59 points or 1.1% to close at 5,467 points. The total trading volume for the day was 335.152 billion HKD. The total trading volume of northbound trading was 126.4 billion HKD, while southbound funds had a net inflow of 0.952 billion HKD today (compared to a net inflow of 3.218 billion HKD on the previous trading day). The Tracker Fund of Hong Kong (02800.HK) rose 0.2% to close at 27 HKD, with a trading volume of 22.849 billion HKD, and the total short selling amount for the day was 4.6 billion HKD, with the short selling ratio dropping to 20.13% (compared to a 3-day average of 38.998%). Real estate and utility stocks provided support, with MTR Corporation (00066.HK) rising nearly 3% to close at 35.84 HKD. Additionally, CSPC Pharmaceutical Group (01093.HK) rose 8.1%.

【MTR Corporation provides support, Tencent fluctuates downwards】

In the technology sector, Tencent (00700.HK) opened flat this morning, but at one point fell 6.3% to a low of 561 HKD. The decline slightly narrowed afterward, closing at 581 HKD, down 2.9%, with a trading volume of 37.562 billion HKD and a total short selling amount of 3.788 billion HKD, with the short selling ratio rising to 10.08% (compared to a 3-day average of 6.289%). Alibaba (09988.HK) fell 1.4% to close at 161 HKD, with a trading volume of 17.74 billion HKD. Baidu (09888.HK) fell 3.6%, Meituan (03690.HK) fell 1.7%, KUAISHOU-W (01024.HK) and Bilibili (09626.HK) fell 4.5% and 2.6%, respectively, while NetEase (09999.HK) rose 0.3%, and JD.com (09618.HK) fell 0.7%.

There are rumors that China's financial industry and online value-added services may face an increase in the value-added tax rate, with the tax rate for the gaming industry possibly rising from 6% to 32%. State media quoted authoritative experts and industry insiders stating that the rumors are not credible. Reports indicate that since January 1 of this year, the "Value-Added Tax Law of the People's Republic of China" and the "Implementation Regulations of the Value-Added Tax Law of the People's Republic of China" have been implemented simultaneously, and the financial and tax departments have recently issued several announcements regarding value-added tax policies. Experts believe that the tax rates for industries related to value-added tax have already been clarified Recently, there has been no adjustment to the value-added tax policies for the gaming and financial industries announced. In addition, China's value-added tax law clearly states that the maximum VAT rate is only 13%, so the rumor that the tax rate for the gaming industry will be raised from 6% to 32% is not credible.

【Stocks Rise by Over 1,300; Commodity Stocks Surge】

The Hong Kong stock market is trending positively, with a rise-to-fall ratio of 33 to 16 for main board stocks (compared to 10 to 42 the previous day), and 1,371 stocks rising (an increase of 3%). Today, 61 constituent stocks of the Hang Seng Index rose, while 27 fell, resulting in a rise-to-fall ratio of 69 to 31 (compared to 13 to 85 the previous day). The market recorded short selling of HKD 55.027 billion today, accounting for 18.725% of the total turnover of shortable stocks at HKD 293.869 billion (compared to 17.448% the previous day).

Commodity prices rose during the Asian session, with spot gold recently reported at USD 4,916 per ounce, up 5.5%, and spot silver surged nearly 9.1% to USD 86.45. China Silver (00815.HK), Lingbao (03330.HK), Minmetals Resources (01208.HK), and Luoyang Molybdenum (03993.HK) rose by 5.8% to 6.4%, while Zijin Mining International (02259.HK) surged 7.8% to close at HKD 217.2. Jiangxi Copper (00358.HK), Zijin (02899.HK), Shandong Gold (01787.HK), Zhaojin (01818.HK), and China Gold International (02099.HK) rose by 3.6% to 4.6%