Just like the sudden red torrential rain in Shenzhen, US stocks were also rumbling and thunder. Economic data suddenly blew up. Concerns about continued inflation made the market wonder when exactly the Federal Reserve would cut interest rates, disturbing the night of global asset unease.

The Fed's interest rate cut is expected to be delayed again. The FTSE A50 Futures Index closed down 0.91% at night. How will A shares and Hong Kong stocks be interpreted today? In particular, for Hong Kong stocks, which have surged recently, can they continue to break out of the independent market without fear from the periphery? Will the transition between funding levels continue?

The opening gave a clear answer: an independent market is expected to be established.

The increase surprised the market. The Hang Seng Technology Index surged more than 3%, and the Hong Kong Stock Connect Internet ETF increased by more than 4%; in terms of A-shares, the GEM Index once rose more than 2%. New energy, computing power, non-ferrous metals, and the automobile industry chain had the highest gains. The capital inflow to the north exceeds 10 billion dollars.

Communications and cloud computing ETFs surged more than 4%

Today, the opening atmosphere for Hong Kong stocks and A-shares was quite warm.

At the last minute before the opening, FTSE China A50 Index futures turned up. The Hang Seng Index and Shanghai Composite Index opened 0.3% and 0.07% higher, then quickly pulled up.

In terms of Hong Kong stocks, the Hang Seng Technology Index rose to 3% at one point. The 30 constituent stocks rose across the board, Sunyu Optical Technology rose more than 5%, and Oriental Choice rose nearly 5%. The Hang Seng Index rose 1.6%, and CNOOC rose more than 5%. The Hang Seng State-owned Enterprises Index rose 2%, while Li Ning rose 5%.

On the A-share side, the GEM index rose more than 2% at one point. Jingsheng Electromechanical and Zhongji Xuchuang increased by more than 10%. Zhongji Xuchuang reached another record high, with a total market capitalization approaching 150 billion yuan, surpassing Sunshine Power and ranking sixth in the total market value of the business.

Equity ETFs are also a window to observe the increase in the market sector. More than 40 equity ETFs in the entire market increased by more than 3%. Among them, ETFs such as communications, cloud computing, and artificial intelligence surged more than 4%.

Although expectations of the Federal Reserve's interest rate cut may be postponed again, Hong Kong stocks and A-shares are not afraid of this peripheral interference and have emerged from a relatively independent market. Recent institutional exchanges indicate that market participants are re-evaluating changes in the market.

In terms of A-shares, what institutions discuss the most is the market style. After the new “National Nine Rules”, the market style changed rapidly. First, small tickets were completely sold off, and after clarification from the supervisory authorities, they switched to small tickets with excellent performance in conjunction with a quarterly report to make up for the increase.

At the level of capital composition, incremental capital is mainly allocated funds with low return expectations such as insurance capital and industrial capital. Under the requirements of regulatory “dividend requirements, quantitative restrictions, and delisting warnings,” few institutions reduced their holdings when AI surged in the first quarter of this year. Institutions believe that under this regulatory trend, it will help grow value style performance in the long term.

In terms of Hong Kong stocks, institutions believe that the recovery in risk appetite has brought about improvements at the capital level, which directly supports the rise in Hong Kong stocks.

On the one hand, the rapid decline in US bond interest rates began in late last year. Hong Kong stocks hardly rose, while capital mainly flowed to Japan. The seesaw effect caused the Nikkei Index to lead the global rise. However, on March 19 this year, the central bank of Japan began raising interest rates, and the rapid depreciation of the yen caused the Nikkei Index's rise to lead the decline in developed markets, and some capital recently returned back to Hong Kong;

On the other hand, after the introduction of the new cooperation measures with Hong Kong, the significance of policy-friendly information was clear, including easing the scope of ETF products, incorporating REITs, optimizing mutual recognition of funds, and unblocking listed financing channels, which also helped to optimize the capital structure and reduce fluctuations in Hong Kong stocks.

Furthermore, foreign investors from Goldman Sachs, UBS, and Morgan Stanley have recently boosted market confidence by being optimistic or increasing their positions in Hong Kong stocks and A-shares.

Many institutions are still adamant about dividends

Amid changes in market style, the biggest main line since this year is the dividend sector represented by high dividends.

Some agencies said that the current mainstream direction approved by most markets is seeking stability with the left hand, seeking change with the right hand, seeking stability as a bottom position, and seeking change is flexibility.

In terms of seeking stability, market value is likely to remain the mainstream capital option, while other value stocks, if popular, have also become the second choice for value stocks in the context of de-dollarization; in terms of seeking change, apart from the core sector of computing power that clearly continues to deliver results, the new quality of productivity represented by the low-altitude economy is a relatively clear direction.

As for the allocation of the Hong Kong stock market in the future, institutions are more firm. Hong Kong stocks have been falling continuously for many years in the midst of pessimism. Currently, valuations are very cheap, and there is a strong demand for valuation repair. In terms of valuation, the Hang Seng Index is 8.87 times PE and 0.88 times PB, which is very cheap from a global perspective.

“However, considering that global capital flows benefit Hong Kong stocks, the gradual recovery of the economy is still a trend. Investors are advised to stay steady and gradually increase the allocation of industries such as Hang Seng Technology and Pharmaceuticals on the basis of high-dividend dividend assets.” An agency said.

Global assets are not calm

On April 25, the US Department of Commerce released the latest economic data before the US stock market, causing global assets to experience an uncertain night.

On the same day, the three major US stock indices opened with a sharp decline. Among them, the NASDAQ index fell by more than 2% at one point. However, by the close, the decline of the three major US stock indexes had subsided from the opening. The Dow fell 0.98%, the NASDAQ fell 0.64%, and the S&P 500 index fell 0.46%.

Wande America's TAMAMA Technology Index fell 1.24%, and most technology stocks fell. Among the “Seven Golden Flowers,” Meta plummeted by more than 10%, the market capitalization evaporated by about 130 billion US dollars, Microsoft fell more than 2%, Google and Amazon fell more than 1%; Tesla rose about 5%, Nvidia rose more than 3%, and Apple rose slightly.

Most Chinese securities closed higher. The Nasdaq China Golden Dragon Index rose 0.75%. In terms of popular individual stocks, Good Future rose 8.81%, Gaotu Group rose 6.82%, Century Internet rose 5.06%, Ehang Smart rose 4.06%, and New Oriental rose 3.35%.

US bond yields collectively closed higher. Last night (April 25), the yield on 10-year US Treasury bonds, the “anchor of global asset pricing,” rose to 4.731%. The 2-year US Treasury yield, which is most closely linked to the Federal Reserve's interest rate expectations, also rose by 5%, both of which hit the highest level since November last year.

By the close, 2-year US Treasury yields rose 7.1 basis points to 5.006%, 10-year US Treasury yields rose 6.1 basis points to 4.707%, and 30-year US Treasury yields rose 4 basis points to 4.814%.

On the commodity side, gold once again made a brilliant debut. COMEX gold futures rose 0.27% to $2344.60 per ounce; COMEX silver futures reported $27.465. Precious metals rose again in early trading today. Some analysts pointed out that although the gold market experienced some solid selling pressure after breaking through the record high of 2,400 US dollars/ounce, compared with the breakthrough gains of the past two months, its consolidation was quite shallow.

According to Gold10 data, SPDR Gold Trust, the world's largest gold ETF, increased its holdings by 1.15 tons on April 25 compared to the previous day. The current holding volume is 834.78 tons. The World Bank predicts that precious metals prices will rise 8% this year.

The US dollar index fell 0.22% last night. The weakening dollar boosted commodity prices, and ICE oil surged 1.16%. According to analysts, rising inflationary pressure is forcing the Federal Reserve to maintain its tighter monetary policy for a longer period than expected, and commodity price inflation is likely to rise this year.

On the European side, the three major stock indexes closed with mixed results. The German DAX index fell 0.91% to 17923.79 points, the French CAC40 index fell 0.93% to 8016.65 points, and the British FTSE 100 index rose 0.48% to 8078.86 points.

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