Hong Kong stocks closed (08.13) | The Hang Seng Index closed down 0.17%, fell more than 4% after Tencent's (00700) performance, and Lenovo Group (00992) soared 20% to a record high

The Zhitong Finance App learned that the three major indices of Hong Kong stocks had mixed ups and downs today, and the Hengke Index once rose more than 1% in the afternoon. At the close, the Hang Seng Index fell 0.17% or 43.66 points to 25396.51 points, with a full-day turnover of HK$263.71 billion; the Hang Seng State-owned Enterprises Index fell 0.23% to 8426.49 points; and the Hang Seng Technology Index rose 0.33% to 4792.39 points.

CICC believes that the “odds” of the Hang Seng Index, which is a broad-based index, are significantly lower than Hengke. Hang Seng Technology declined even deeper in the early stages. The current valuation is still at a historically low level. The odds advantage has not been completely exhausted. The subsequent decline in interest rates on US bonds, catalyzed by leading Internet companies, and capital rebalancing will also be stronger.

Blue-chip stock performance

Lenovo Group (00992) reached a record high. At the close, it was up 20.18% to HK$34.9, with a turnover of HK$11.848 billion. Contributed 61.09 points. In the first fiscal quarter, Lenovo achieved a 176% year-on-year increase in adjusted net profit to US$1,075 billion, breaking through US$1 billion for the first time. The adjusted net profit margin reached 4%, nearly doubling year-on-year. On-hand order reserves for AI servers reached US$54 billion, an increase of 157% quarterly. The company said that revenue from AI-related businesses increased 60% year over year.

In terms of other blue-chip stocks, Master Kong Holdings (00322) rose 6.75% to HK$13.12, contributing 2.58 points to the Hang Seng Index; Changshi Group (01113) rose 3.62% to HK$48.1, contributing 4.97 points to the Hang Seng Index; Xinyi Solar (00968) fell 5.95% to HK$2.26, dragging down the Hang Seng Index by 1.06 points; and Tencent (00700) fell 4.46% to HK$441, dragging down the Hang Seng Index by 89.11 points.

Popular sector aspects

On the market, large tech stocks were generally under pressure. After Tencent's performance, it fell more than 4%, and Alibaba dropped 0.57%. AI servers exploded. Lenovo Group's performance soared by more than 20%, and Huaqin Technology surged more than 10%; innovative drug concepts continued to rise, with Kingsley Biotech rising by more than 4%; AI supermodel Shuang Xiong rose higher, and Smart Spectrum was included in the MSCI China Index by more than 9%. On the other side, non-ferrous metals had the highest declines; domestic housing stocks and heavy machinery stocks generally weakened.

Innovative drugs are once again active. At the close, Zaiding Pharmaceuticals (09688) rose 4.73% to HK$20.6; Baiosetu-B (02315) rose 4.69% to HK$70.25; and Kingsley Biotech (01548) rose 4.51% to HK$25.98.

Innovative drugs were authorized to go overseas and entered the high-frequency implementation period. On August 10, a single three-pound deal occurred: BeiGene cooperated with Revolution Medicines to explore innovative combination treatment plans for cancer and obtained exclusive development and commercialization rights for four clinical-stage drug candidates in some Asian markets; Cinda Biotech joined hands with Daiichi Sankyo to win the commercialization and promotion rights of Vifotai in the mainland China market; Gan Li Pharmaceutical used Menarini to promote self-developed GLP-1 innovative drugs into the European market. According to Zhongtai Securities, recent financial reports from leading overseas pharmaceutical companies have continued to verify the value of China's innovative assets, and MNC's strategic position on innovative drugs in China has gradually improved.

The AI server concept is impressive. At the close, Lenovo Group (00992) rose 20.18% to HK$34.9; Huaqin Technology (03296) rose 10.4% to HK$77.5.

Lenovo ISG's revenue for the first fiscal quarter increased 98% year over year to 8.5 billion US dollars, and the operating profit margin rose to 9.1%, an increase of 5.5 percentage points over the previous quarter; the AI server's on-hand order reserves reached 54 billion US dollars, an increase of 157% over the quarter. In addition, Tencent recently announced its results for the second quarter of 2026. The company's capital expenditure on computing power purchases surged to 52,784 billion yuan in the second quarter, an increase of 176.3% year-on-year and 65.3% month-on-month. Open Source Securities previously pointed out that the demand side continues to verify that AI computing power is just needed, the supply-side domestic computing power penetrates at an accelerated pace, the positive cycle effect of large manufacturers has formed, domestic computing power replacement has entered a period of acceleration, and large-scale deployment of domestic supernodes is accelerating.

The concept of optical communication continues to rise. At the close, Haiguang Xinzheng (01191) was up 7.91% to HK$100.9; Cambridge Technology (06166) was up 6.61% to HK$91.9; and Zhongji (03308) was up 2.89% to HK$1,141.

Optical communications giant Coherent Corp announced financial results for the fourth quarter of the 2026 fiscal year ending the end of June. Financial reports show that demand for optical connectivity in AI data centers has exploded, driving Coherent Corp's revenue to accelerate and profit margins to rise, and the company's quarterly revenue reached a record high of US$2.05 billion. Coherent expects revenue of 2.2 billion to 2.4 billion US dollars for the first fiscal quarter, and expected adjusted earnings per share of 1.85 to 2.05 US dollars for the first fiscal quarter, all higher than market expectations. Wanlian Securities pointed out that global AI computing power infrastructure construction continues to accelerate, driving demand for optical connectivity at home and abroad to maintain a high boom.

Gold stocks collectively retreated. At the close, Lingbao Gold (03330) fell 9.43% to HK$20.56; China Gold International (02099) fell 7.69% to HK$187.2; and Shandong Gold (01787) fell 6.25% to HK$21.6.

The US CPI fell from 3.5% to 3.4% in July, and the core CPI fell from 2.6% to 2.5%, all in line with market expectations. The moderate inflation data showed no major surprises, easing the pressure on the Federal Reserve to speed up interest rate hikes. However, the lack of data with a clear direction caused the gold market to show a long and short war. Spot gold fell below the 4,400 US dollar mark today. It is worth noting that gold prices had been rising for several days before, and last week they recorded their best weekly performance since January. Liu Yu, chief economist at Societe Generale Securities, said that the rise in gold prices in this round was mainly driven by the cooling of expectations of interest rate hikes after the non-agricultural data unexpectedly turned negative, while transactional capital amplified the increase.

Popular exotic stocks

Bruco (00325) is trending strongly. At the close, it was up 19.73% to HK$71.

Bruker announced its 2026 interim results, with revenue of RMB 1,776 billion for the first half of the year, up 32.7% year on year; net profit of 387 million yuan, up 30.5% year on year, profit of 1.56 yuan per share, and an interim interest of HK32.47 cents. This was the first time since listing that it paid dividends.

Nexteer (01316) surged after the results. At the close, it was up 9.71% to HK$4.915.

Nexteer announced its 2026 interim results, with revenue of US$2,329 million, up 3.86% year on year. Profit attributable to equity holders was US$85.806 million, up 35.17% year on year. Dahua Jixian raised its target price from HK$8.3 to HK$11.4, with a “buy” rating.

Sanhuan Group (06951) reached a record high. At the close, it was up 9% to HK$130.8.

MLCC has set off a wave of price chasing and material grabbing. In order to obtain sufficient material sources, some customers did not hesitate to ask for goods from major passive component manufacturers such as Guoju and Murata Manufacturing, creating an atmosphere where those with higher prices would win, highlighting the continuous increase in the tight supply and demand of MLCC.

Zhi Spectrum (02513) performed brilliantly. At the close, it was up 9.02% to HK$1,317.

MSCI announced the results of the MSCI stock index review for August 2026. In this adjustment, the MSCI China Index has added 33 new stocks, including Smart Spectrum. The adjustments will take effect after the market closes on August 31. When a stock enters the MSCI China Index, it means that it has entered the MSCI Global Standard Index series, thus receiving a large amount of passive financial tracking.

Tencent Holdings (00700) was under pressure throughout the day. At the close, it was down 4.46% to HK$441.

Upfront investment in AI infrastructure “smashed” cash flow into a negative amount. Tencent's capital expenditure in the second quarter reached 52.8 billion yuan, up 65% from 31.9 billion yuan in the first quarter; free cash flow turned negative to -13.8 billion yuan. This is also the first time since 2005 that Tencent's free cash flow is negative.