Key News
Asian equities were mostly lower overnight, though Hong Kong and Taiwan managed gains, while Mainland China's STAR (Science & Technology) Market and Shenzhen Component underperformed.
Hong Kong and Mainland China diverged overnight, as the former closed higher though off best levels, while the latter was sharply lower overnight. AI supply chain stocks were sold off again, as the STAR Market fell -3%. There was a slight value bias in Mainland China, as energy and utilities outperformed as the market took a defensive turn. Mainland investors sold a net $17 million worth of Hong Kong-listed stocks and ETFs.
Internet stocks were mixed as Alibaba gained +3.1%, Tencent fell -0.40%, and JD.com gained +1.1%. Meituan had a strong session, gaining +6.64%. Brokers said that the company provided pre-earnings guidance, which it does not normally do, to a select group, which sent the stock higher. Meituan is expected to see a significant improvement in its profitability in the coming quarters after its margins were pressured by extreme competition in the food delivery and local services business, which is its core business.
China released its September consumer price index (CPI) and producer price index (PPI) overnight. The CPI rose 0.9% year-over-year (YoY), and the PPI rose 5.0% YoY. The CPI print was positive, as China continues to stave off deflation, which can weigh on consumption. Meanwhile, the surge in producer prices was mainly driven by high oil prices as a result of the Iran conflict as well as high demand for equipment and chips from AI hyperscalers.
China's central bank reported that aggregate financing, i.e., loans, increased by RMB 27.46 trillion in the first three quarters of 2026, while new RMB loans increased by RMB 11.52 trillion. China's customs office reported that electronic equipment manufacturing drove 90% of export growth in the first three quarters of 2026.
Tencent priced the bonds in its $1.8 billion offering to fund AI capital expenditure. The company is ramping up its capital expenditure, while Alibaba’s capital expenditure has likely peaked.
Biotech firm Akeso, which recently entered into a partnership with AstraZeneca, was down -10% in Hong Kong overnight. Seemingly, the downdraft was due to a new share issuance. We remain positive on the company and the health care sector overall, viewing it as a key AI beneficiary. The share sale is likely to fund more research and development as AI-driven molecule development accelerates. We recently published an article on China's growing importance as a source of innovation in health care.
Hang Seng Tech shines as Asia slips broadly
6 of 17 markets were up; Hang Seng Tech was the standout gainer.
+0.9%
Hang Seng Tech (best)
-17
Southbound Connect (US$ mn)
| Market | Change | 1-Day |
|---|
Hang Seng Tech HSTECH Index |
| +0.9% |
Taiwan TWSE Index |
| +0.6% |
Pakistan KSE100 Index |
| +0.4% |
Indonesia JCI Index |
| +0.3% |
Malaysia FBMKLCI Index |
| +0.3% |
Thailand SET Index |
| +0.3% |
Japan NKY Index |
| 0.0% |
China (Hong Kong) HSI Index |
| -0.1% |
Singapore STI Index |
| -0.1% |
India SENSEX Index |
| -0.3% |
South Korea KOSPI Index |
| -0.4% |
Australia AS51 Index |
| -0.6% |
Vietnam VNINDEX Index |
| -0.8% |
China (Shanghai) SHCOMP Index |
| -0.9% |
Philippines PCOMP Index |
| -1.5% |
China (Shenzhen) SZCOMP Index |
| -1.8% |
China (STAR Board) STAR50 Index |
| -3.3% |
| Hong Kong and Mainland China Liquidity (1-Day Change) |
Hong Kong Turnover HKTurn Index | +3.2% |
Hong Kong Short Sale Turnover HKSST Index | -0.6% |
Short Turnover as % of HK Turnover | 27.06% |
Southbound Connect Net Buy/Sell (US$ mn) | -17 |
Mainland Turnover .CHTURN Index | -15.4% |
Growth stocks outperform in Hong Kong while Value stocks outperform in Mainland China
37 / 54
HK Advancing / Declining
105 / 185
Mainland Advancing / Declining
| Indicator | Hong Kong | Mainland China |
|---|
| Volume % of 1-Year Average | 75% | 70% |
| Advancing / Declining | 37 / 54 | 105 / 185 |
| Outperforming Factors | Growth | Value |
| Underperforming Factors | Value | Growth |
| Top Sectors | Consumer DiscretionaryConsumer StaplesEnergy | EnergyUtilitiesConsumer Staples |
| Bottom Sectors | Health CareMaterialsIndustrials | Information TechnologyMaterialsIndustrials |
| Top Subsectors | AerospacePetroleum & PetrochemicalsTextiles | Oil & GasLand TransportationHighways |
| Bottom Subsectors | Electric EquipmentChemical IndustryPharmaceuticals | Communication EquipmentPower GenerationComputer Hardware |
| Southbound Connect Buys | Alibaba, Akeso, Meituan | — |
| Southbound Connect Sells | Xiaomi, KB Laminates, Genscript Biopharmaceuticals | — |
Hong Kong and Mainland China trade broadly lower
-0.31%
Hong Kong listed (152)
-0.70%
Mainland listed (400)
| Sector | # Stocks | Change | Avg. 1-Day |
|---|
| Hong Kong Listed · 152 stocks | -0.31% |
| Consumer Discretionary | 27 |
| +2.19% |
| Consumer Staples | 12 |
| +1.28% |
| Energy | 7 |
| +1.04% |
| Utilities | 10 |
| +0.81% |
| Information Technology | 14 |
| +0.48% |
| Communication Services | 7 |
| -0.25% |
| Real Estate | 6 |
| -0.94% |
| Financials | 24 |
| -1.16% |
| Industrials | 16 |
| -1.29% |
| Materials | 14 |
| -2.23% |
| Health Care | 15 |
| -3.29% |
| Mainland China Listed · 400 stocks | -0.70% |
| Energy | 11 |
| +1.57% |
| Consumer Staples | 16 |
| +0.62% |
| Communication Services | 9 |
| +0.30% |
| Financials | 60 |
| -0.35% |
| Health Care | 26 |
| -0.57% |
| Consumer Discretionary | 21 |
| -1.12% |
| Industrials | 62 |
| -1.55% |
| Materials | 69 |
| -1.81% |
| Information Technology | 126 |
| -3.39% |
US & Hong Kong Dually Listed
| Company | Change | 1-Day |
|---|
Meituan 3690 HK Equity |
| +6.6% |
Alibaba 9988 HK Equity |
| +3.1% |
Nio 9866 HK Equity |
| +2.6% |
Xpeng 9868 HK Equity |
| +2.1% |
Baozun 9991 HK Equity |
| +1.7% |
JD.com 9618 HK Equity |
| +1.1% |
Tencent Music Ent. 1698 HK Equity |
| +1.0% |
NetEase 9999 HK Equity |
| +0.9% |
Baidu 9888 HK Equity |
| +0.5% |
Weibo 9898 HK Equity |
| +0.5% |
Trip.com 9961 HK Equity |
| +0.1% |
Li Auto 2015 HK Equity |
| +0.1% |
New Oriental (EDU) 9901 HK Equity |
| 0.0% |
Tencent 700 HK Equity |
| -0.4% |
Yum China 9987 HK Equity |
| -0.7% |
Zhihu 2390 HK Equity |
| -1.3% |
KE Holdings 2423 HK Equity |
| -1.5% |
Autohome 2518 HK Equity |
| -2.5% |
Bilibili 9626 HK Equity |
| -4.9% |
Meituan surges +6.6% among Hong Kong's most-traded stocks
| Value Traded Rank · Company | Change | 1-Day |
|---|
1Alibaba Group Holding |
| +3.1% |
2Tencent Holdings |
| -0.4% |
3Xiaomi |
| +5.4% |
4Meituan |
| +6.6% |
5Kingboard Laminates |
| -5.2% |
6Lenovo Group |
| -2.3% |
7Semiconductor Manufacturing |
| -2.3% |
8Yangtze Optical Fibre |
| -6.2% |
9Akeso |
| -9.6% |
10Ping An Insurance |
| -1.5% |
Semiconductors lead losses among Shanghai & Shenzhen's most-traded stocks
| Value Traded Rank · Company | Change | 1-Day |
|---|
1Visual China Group |
| +1.2% |
2Shantui Construction |
| -0.7% |
3Zhongji Innolight |
| -5.7% |
4Eoptolink Technology |
| -5.8% |
5CATL |
| -3.1% |
6CXMT Corp |
| -2.1% |
7Suzhou Dongshan Precision |
| -6.0% |
8Cambricon Technologies |
| -4.9% |
9Suzhou TFC Optical |
| -7.2% |
10Gigadevice Semiconductor |
| -4.5% |
Last Night's Exchange Rates, Prices, & Yields
- CNY per USD 6.70 versus 6.69 yesterday
- CNY per EUR 7.45 versus 7.50 yesterday
- Yield on 10-Year Government Bond 1.65% versus 1.67% yesterday
- Yield on 10-Year China Development Bank Bond 1.71% versus 1.73% yesterday
- Copper Price -0.73%
- Steel Price -0.29%
