China Last Night powered by KraneShares is a daily note produced by KraneShares research team led by Chief Investment Officer Brendan Ahern. The note covers top news and events that moved China’s capital markets last night while you were probably sleeping.
What you will receive every day
Daily color on what drove China’s equity, fixed income, and currency markets' performance last night
Aggregated local broker insights
Daily analysis of important policy, trade, public company news / announcements
Sector level performance analysis across Mainland, Hong Kong, and US stock exchanges
Hardware Sell Off Continues Amid World AI Conference, Week in Review
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Week in Review
Asian equities were mixed for the week as Indonesia and Malaysia outperformed, while Mainland China's STAR (science & technology) Market and Shenzhen underperformed, as investors rotated our of AI hardware plays and into software.
On Monday, China's State Council approved a plan to raise retail sales to RMB 60 trillion by 2030, up from RMB 50 trillion in 2025, which lifted E-Commerce stocks.
According to a data release Tuesday, exports of "high-tech products" increased 39% year-over-year in May, mostly attributed to memory chips and technology hardware.
Healthcare stocks rallied this week after the over 600 drugs were added to the national insurance reimbursement list.
Friday's Key News
Asian equities were mostly lower overnight, though India and the Philippines managed gains, while Mainland China's STAR (science & technology) Market and Taiwan underperformed. It was another night of selling in technology hardware companies as investors continued to take profits in year-to-date winners amid skepticisim of the longevity of hyperscaler capital expenditure.
There was a clear value bias in both Mainland China and Hong Kong overnight, as energy and financials outperformed. Similar to yesterday, Hong Kong fared better than the Mainland, due to its software and internet orientation and relative year-to-date weakness. Mainland investors sold a net -$186 million worth of Hong Kong-listed stocks and ETFs overnight via Southbound Stock Connect. Interestingly, the selling was broad, affecting both momentum-driven hardware and software names that have underperformed. Top sales included Hua Hong Semiconductor and Alibaba.
Shares of large language model (LLM) provider Knowledge Atlas (Zhipu/Z AI) fell -28% in Hong Kong overnight on expected competition from Moonshot AI after its model was said to perform better. The competition remains steep in China's focused AI model provider industry. These providers are seeing great opportunity as global corporations seek less expensive alternatives to US LLMs.
Mainland-listed chipmaker Moore Threads reported a preliminary range for its first half revenue of between RMB 1.65 billion and RMB1.75 billion, representing year-on-year growth between 235% and 249%.
At the World Artificial Intelligence Conference (WAIC), currently being held in China, Mainland media emphasized "all-factor sharing" of AI developments, promoting China's open-source approach to the technology. The WAIC was also attended by President Xi, underscoring the importance of AI and this philosophical stance to China's government. At the same time, global corporations, including Shopify and Airbnb, say they use Alibaba's Qwen model because its open-source structure allows them to customize it and run it on their own infrastructure, cutting costs.
Last Night's Performance
Country / Index
Ticker
1-Day Change
China (Hong Kong)
HSI Index
-1.8%
Hang Seng Tech
HSTECH Index
-4.4%
Hong Kong Turnover
HKTurn Index
7.6%
Hong Kong Short Sale Turnover
HKSST Index
19.1%
Short Turnover as a % of Hong Kong Turnover
N/A
20%
Southbound Stock Connect Net Buy/Sell (US $ Millions)
N/A
-186.03
China (Shanghai)
SHCOMP Index
-3%
China (Shenzhen)
SZCOMP Index
-5.2%
China (STAR Board)
Star50 Index
-7.1%
Mainland Turnover
.chturn Index
10.4%
Japan
NKY Index
-4%
India
SENSEX Index
1.2%
Indonesia
JCI Index
1.1%
Malaysia
FBMKLCI Index
0.5%
Pakistan
KSE100 Index
-1.2%
Philippines
PCOMP Index
1.2%
South Korea
KOSPI Index
Closed
Taiwan
TWSE Index
-6.5%
Thailand
SET Index
0.2%
Singapore
STI Index
-0.5%
Australia
AS51 Index
-0.5%
Vietnam
VNINDEX Index
-0.05%
Indicator
Hong Kong
Mainland China
Today's Volume % of 1-Year Average
126
109
Advancing Stocks
24 (Hang Seng)
73 (CSI 300)
Declining Stocks
67 (Hang Seng)
221 (CSI 300)
Outperforming Factors
Value
Value
Underperforming Factors
Growth
Growth
Top Sectors
Utilities, Energy, Financials
Utilities, Financials, Energy
Bottom Sectors
Health Care, Information Technology, Materials
Information Technology, Communication Services, Health Care
Top Subsectors
Utilities, Real Estate, Banks
Power, Oil & Gas, Banks
Bottom Subsectors
Semiconductors, Technology Hardware, Software
Communication Equipment, Computer Hardware, Electronic Components
Southbound Connect Buys
Xiaomi, Giga Device, YOFC
N/A
Southbound Connect Sells
Alibaba, Meituan, Hua Hong Grace Semiconductor
N/A
MSCI China All Shares Index
# of Stocks
Average 1-Day Change (%)
Hong Kong Listed
165
-2.89
Communication Services
11
-4.3
Consumer Discretionary
28
-3.04
Consumer Staples
13
-0.69
Energy
6
0.65
Financials
25
-0.15
Health Care
16
-6.08
Industrials
22
-2.04
Information Technology
12
-5.27
Materials
14
-4.76
Real Estate
7
-1.76
Utilities
11
0.73
Mainland China Listed
386
-3.91
Communication Services
8
-5
Consumer Discretionary
26
-1.87
Consumer Staples
19
-1.19
Energy
12
-0.73
Financials
64
-0.19
Health Care
31
-4.77
Industrials
58
-2.42
Information Technology
95
-8.27
Materials
52
-3.36
US & Hong Kong Dually Listed
Ticker
1-Day Change (%)
Tencent HK
700 HK Equity
-4.6
Alibaba HK
9988 HK Equity
-3.7
JD.com HK
9618 HK Equity
-0.4
NetEase HK
9999 HK Equity
-0.9
Yum China HK
9987 HK Equity
0.2
Baozun HK
9991 HK Equity
-6.2
Baidu HK
9888 HK Equity
-3.4
Autohome HK
2518 HK Equity
-1
Bilibili HK
9626 HK Equity
-5.7
Trip.com HK
9961 HK Equity
-1.1
EDU HK
9901 HK Equity
-2
Xpeng HK
9868 HK Equity
-8.7
Weibo HK
9898 HK Equity
-1.6
Li Auto HK
2015 HK Equity
-2.9
Nio Auto HK
9866 HK Equity
-6.6
Zhihu HK
2390 HK Equity
-3.3
KE HK
2423 HK Equity
-1.2
Tencent Music Entertainment HK
1698 HK Equity
1
Meituan HK
3690 HK Equity
-4.1
Hong Kong's Most Heavily Traded by Value
1-Day Change (%)
Z AI CO LTD
-28.5
SEMICONDUCTOR MANUFACTURI-H
-10
TENCENT HOLDINGS LTD
-4.6
ALIBABA GROUP HOLDING LTD
-3.7
HUA HONG GRACE SEMICONDUCTOR
-11.9
XIAOMI CORP-CLASS B
-2.3
KINGBOARD LAMINATES HLDG LTD
-14.3
MEITUAN-CLASS B
-4.1
YANGTZE OPTICAL FIBRE AND-H
-11.2
KUAISHOU TECHNOLOGY
-7.8
Shanghai and Shenzhen's Most Heavily Traded by Value
1-Day Change (%)
ZHONGJI INNOLIGHT CO LTD-A
-12
EOPTOLINK TECHNOLOGY INC L-A
-11
GIGADEVICE SEMICONDUCTO-CL A
-10
SUZHOU DONGSHAN PRECISION-A
-10
JCET GROUP CO LTD-A
2.7
CAMBRICON TECHNOLOGIES-A
-6.9
MONTAGE TECHNOLOGY CO LTD-A
-13
CONTEMPORARY AMPEREX TECHN-A
-1.7
BOE TECHNOLOGY GROUP CO LT-A
0.3
SEMICONDUCTOR MANUFACTURIN-A
-7.9
Last Night's Exchange Rates, Prices, & Yields
CNY per USD 6.78 versus 6.77 yesterday
CNY per EUR 7.76 versus 7.75 yesterday
Yield on 10-Year Government Bond 1.74% versus 1.74% yesterday
Yield on 10-Year China Development Bank Bond 1.79% versus 1.82% yesterday
Copper Price -0.73%
Steel Price -0.32%
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