Risk Off Takes Hold Once Again
5 Min. Read Time
Key News
Asian equities were risk-off overnight, except for Korea and Vietnam, amid continued Middle East concerns and a stronger US dollar. Mainland media reported that Iranian airspace will reopen in four stages, a potentially positive sign.
Both Hong Kong and Mainland China were risk-off, with decliners far outpacing advancers, with only oil & gas, banks, coal, and battery maker CATL as rare bright spots in both markets. Hong Kong and Mainland China-listed tech hardware and semiconductors were hit by profit-taking, along with other growth sectors, including non-ferrous metals and internet. Tesla's comments on their slower humanoid Optimus rollout took the wind out of local names, ironically, while automakers were off on Tesla self-driving coming to China.
One of the few positives was that Mainland investors bought the dip, with a healthy $1.10 billion worth of Hong Kong-listed stocks and ETFs. The Hong Kong Tracker ETF, in particular, saw a very large net inflow of $467 million.
Tencent fell -1.75% and was one of Hong Kong's most heavily stocks traded by value. One large put option traded. However, after the close, it announced the launch of a new open-source AI model. Alibaba fell -0.84% and was Hong Kong's second-most heavily traded strock by value. It had two large put option trades. Meituan, which fell -1.36%, also had two large put option trades. However, it announced a partnership with Gree Electronic Appliances that allows buyers to receive appliances, such as air conditioners and refrigerators, within 30 minutes to 2 hours.
Baidu announced it will report Q1 results on Monday, May 18th. JD fell -1.25%, as a Mainland media source reported that the company was fined $438 million for its significant role in the "ghost restaurant" industry. This appears to be part of the restaurant delivery crackdown. The State Administration of Market Regulation (SAMR) released "Key Tasks for Order Rectification of Internet Advertising Market," which included setting rules on AI advertising.
TAL Education reported fiscal year Q4 results after the Hong Kong close. The education technology and tutoring services provider reported revenue that inceased +31% to $802 million from $610 million in the first quarter of 2025, versus expectations of $779 million. Adjusted net income was $254 million, up from $7 million, versus expectations of $254 million, and adjusted earnings per share (EPS) that surged +4,400% to $0.45 from $0.01 versus expectations of $0.11.
Last Night's Performance
| Country / Index | Ticker | 1-Day Change |
|---|---|---|
| China (Hong Kong) | HSI Index | -0.9% |
| Hang Seng Tech | HSTECH Index | -2% |
| Hong Kong Turnover | HKTurn Index | 11.9% |
| Hong Kong Short Sale Turnover | HKSST Index | 33.7% |
| Short Turnover as a % of Hong Kong Turnover | N/A | 19.3% |
| Southbound Stock Connect Net Buy/Sell (US $ Millions) | N/A | 1,098.10 |
| China (Shanghai) | SHCOMP Index | -0.3% |
| China (Shenzhen) | SZCOMP Index | -1.1% |
| China (STAR Board) | Star50 Index | -1.3% |
| Mainland Turnover | .chturn Index | 9.6% |
| Japan | NKY Index | -0.7% |
| India | SENSEX Index | -1.1% |
| Indonesia | JCI Index | -2.2% |
| Malaysia | FBMKLCI Index | 0.7% |
| Pakistan | KSE100 Index | -1.6% |
| Philippines | PCOMP Index | -0.1% |
| South Korea | KOSPI Index | 0.9% |
| Taiwan | TWSE Index | -0.4% |
| Thailand | SET Index | -1.2% |
| Singapore | STI Index | -1.2% |
| Australia | AS51 Index | -0.6% |
| Vietnam | VNINDEX Index | 0.7% |
| Indicator | Hong Kong | Mainland China |
|---|---|---|
| Today's Volume % of 1-Year Average | 99 | 138 |
| Advancing Stocks | 139 | 1295 |
| Declining Stocks | 367 | 3773 |
| Outperforming Factors | Low Volatility | Low Volatility, Dividend Yield, Quality |
| Underperforming Factors | Growth, Liquidity, EPS Revision | Liquidity, Momentum, Buyback |
| Top Sectors | Energy, Industrials, Utilities | Energy, Utilities, Staples |
| Bottom Sectors | Healthcare, Materials, Tech | Materials, Real Estate, Communication |
| Top Subsectors | Petroleum/Petrochemical, Coal, Telecom Services | Beverage Manufacturing, Heavy Machinery, Coal |
| Bottom Subsectors | Non Ferrous Metal, Auto, Consumer Durables/Apparel | Precious Metals, Base Metals, Packaging |
| Southbound Connect Buys | HK Tracker ETF (Very Large)HS Tech ETF, HS China Enterprise ETF (Large), CNOOC (Moderate), YOFC (Small) | |
| Southbound Connect Sells | Alibaba, SMIC (Moderate) |
| MSCI China All Shares Index | # of Stocks | Average 1-Day Change (%) |
|---|---|---|
| Hong Kong Listed | 164 | -1.25 |
| Communication Services | 11 | -1.73 |
| Consumer Discretionary | 28 | -1.6 |
| Consumer Staples | 12 | -0.79 |
| Energy | 6 | 3.26 |
| Financials | 25 | -0.06 |
| Health Care | 16 | -4.06 |
| Industrials | 19 | 0.7 |
| Information Technology | 15 | -2.24 |
| Materials | 14 | -2.54 |
| Real Estate | 1 | -0.89 |
| Utilities | 6 | 0.45 |
| Mainland China Listed | 11 | -0.66 |
| Communication Services | 11 | -1.21 |
| Consumer Discretionary | 26 | -0.3 |
| Consumer Staples | 18 | 0.25 |
| Energy | 11 | 1.71 |
| Financials | 64 | -0.43 |
| Health Care | 29 | 0.03 |
| Industrials | 60 | -0.16 |
| Information Technology | 113 | -1 |
| Materials | 58 | -2.56 |
| US & Hong Kong Dually Listed | Ticker | 1-Day Change (%) |
|---|---|---|
| Tencent HK | 700 HK Equity | -1.7 |
| Alibaba HK | 9988 HK Equity | -0.8 |
| JD.com HK | 9618 HK Equity | -1.2 |
| NetEase HK | 9999 HK Equity | -2.9 |
| Yum China HK | 9987 HK Equity | -1.6 |
| Baozun HK | 9991 HK Equity | -4.3 |
| Baidu HK | 9888 HK Equity | -0.5 |
| Autohome HK | 2518 HK Equity | -0.6 |
| Bilibili HK | 9626 HK Equity | -0.6 |
| Trip.com HK | 9961 HK Equity | -1.7 |
| EDU HK | 9901 HK Equity | -3.7 |
| Xpeng HK | 9868 HK Equity | -6.4 |
| Weibo HK | 9898 HK Equity | -2 |
| Li Auto HK | 2015 HK Equity | -0.4 |
| Nio Auto HK | 9866 HK Equity | -0.9 |
| Zhihu HK | 2390 HK Equity | -0.4 |
| KE HK | 2423 HK Equity | -1.5 |
| Tencent Music Entertainment HK | 1698 HK Equity | -2.5 |
| Meituan HK | 3690 HK Equity | -1.4 |
| Hong Kong's Most Heavily Traded by Value | 1-Day Change (%) |
|---|---|
| TENCENT HOLDINGS LTD | -1.7 |
| ALIBABA GROUP HOLDING LTD | -0.8 |
| YANGTZE OPTICAL FIBRE AND-H | 17.2 |
| XIAOMI CORP-CLASS B | -1.9 |
| BYD CO LTD-H | -3.3 |
| SEMICONDUCTOR MANUFACTURI-H | -1.3 |
| AKESO INC | -12.7 |
| CNOOC LTD-H | 2.9 |
| POP MART INTERNATIONAL GROUP | -2.9 |
| HUA HONG SEMICONDUCTOR LTD-H | -5.9 |
| Shanghai and Shenzhen's Most Heavily Traded by Value | 1-Day Change (%) |
|---|---|
| ZHONGJI INNOLIGHT CO LTD-A | 2.5 |
| EOPTOLINK TECHNOLOGY INC L-A | 7.6 |
| SUZHOU DONGSHAN PRECISION-A | 0.2 |
| SUZHOU TFC OPTICAL COMMUNI-A | 6.3 |
| FOXCONN INDUSTRIAL INTERNE-A | 8.9 |
| HENGTONG OPTIC-ELECTRIC CO-A | 5.7 |
| VICTORY GIANT TECHNOLOGY -A | 3.6 |
| LUXSHARE PRECISION INDUSTR-A | 3.5 |
| CONTEMPORARY AMPEREX TECHN-A | -1 |
| ACCELINK TECHNOLOGIES CO -A | 6.2 |
Last Night's Exchange Rates, Prices, & Yields
- CNY per USD 6.83 versus 6.82 yesterday
- CNY per EUR 7.98 versus 8.01 yesterday
- Yield on 10-Year Government Bond 1.75% versus 1.74% yesterday
- Yield on 10-Year China Development Bank Bond 1.85% versus 1.83% yesterday
- Copper Price +0.64%
- Steel Price +0.35%
