According to the Wisdom Financial app, the three major Hong Kong stock indices collectively fell today, with the Hang Seng Index once falling by 900 points intraday, breaking through the 21,000 mark; the Hang Seng Tech Index performed the worst, with the decline expanding by more than 5% at one point. As of the close, the Hang Seng Index fell by 3.67% or 774.08 points to 20,318.79 points, with a total daily turnover of 261.288 billion Hong Kong dollars; the Hang Seng China Enterprises Index fell by 3.99% to 7,277.83 points; the Hang Seng Tech Index fell by 4.65% to 4,450.95 points.

Ping An Securities believes that the unexpectedly strong US non-farm payroll data for September has led to a pullback in rate cut expectations, indicating that the most liberal overseas environment faced by the Hong Kong stock market may be over. Domestically, the special fiscal event held by the State Council Information Office on October 12 conveyed signals of follow-up comprehensive incremental policies to the market, which to a certain extent stabilized the post-holiday market that was somewhat entangled. Overall, after returning to rationality, the Hong Kong stock market is showing more of a trend of oscillating upwards, with high volatility and high industry differentiation becoming the main features of the market recently.

Blue chip performance

China Resources Beer (00291) led the decline among blue chips. As of the close, it fell by 12.87% to HK$29.45, with a turnover of 1.305 billion Hong Kong dollars, dragging the Hang Seng Index down by 11.4 points. Guosen Securities pointed out that beer consumption during the National Day holiday was weak, with a positive transmission of macro policies to consumer spending still requiring some time, while the beer industry has entered the off-season. Overall, the market's expectations for the performance of leading beer companies in the second half of the year are not high, but with the current macro policies clearly in action, next year's gradual improvement in demand may bring repair resilience to the beer industry on healthy inventory levels and a low sales base.

Looking at other blue chips, CKI Holdings (01038) rose by 1.67% to HK$54.7, contributing 0.92 points to the Hang Seng Index; Power Assets (00006) rose by 0.79% to HK$51.2, contributing 0.91 points to the Hang Seng Index; Xinyi Solar (00968) fell by 8.83% to HK$3.2, dragging the Hang Seng Index down by 2.42 points; Zhongsheng Hldg (00881) fell by 6.95% to HK$11.52, dragging the Hang Seng Index down by 1.17 points.

Hot sectors

On the market, large-cap technology stocks all fell sharply, with Alibaba falling more than 5% and Tencent dropping more than 4%. Consumer stocks are under pressure, with beer stocks leading the decline; the property market lacks luster during the traditionally busy 'September-October' homebuying season, with mainland real estate stocks collectively falling, many stocks dropping more than 10%; Trump reiterates tariffs on Mexican cars, causing automotive stocks to continue to decline; a strong dollar is putting pressure on nonferrous metals, with all nonferrous metals trading in the red; infrastructure stocks, China-affiliated brokerage stocks, petroleum stocks, etc., are all falling. On the other hand, the semiconductor 'barometer' is accelerating its recovery, with the semiconductor sector surging in early trading; Bitcoin once touched $0.066 million, and cryptocurrency ETFs continued to rise.

1. Mainland real estate stocks all fell. As of the close, Zhongliang Hldg (02772) fell by 19.33%, closing at HK$0.121; Sunac (01918) fell by 12%, closing at HK$2.2; R&F Properties (02777) fell by 10.71%, closing at HK$1.5; Agile Group (03383) fell by 9.71%, closing at HK$0.93.

According to statistics from China Index Institute, sales of the top 100 real estate companies in September decreased by 38.81% year-on-year and decreased by 2.2% from the previous month. Looking at the cumulative data for the first three quarters of this year, the performance scale of the top 100 real estate companies has remained at historically low levels. Data from the China Index Institute shows that from January to September 2024, the total sales of the top 100 real estate companies amounted to 2.96994 trillion yuan, a year-on-year decrease of 38.8%.

Furthermore, according to a report by HSBC Research, taking the stock market rebound dominated by policies from April to May as a reference, the valuation of the mainland real estate industry is being re-evaluated, favoring large-cap stocks. The bank pointed out that only three mainland real estate stocks, including China Overseas Land & Investment and China Resources Land, are valued at or below the high levels of May, while the valuations of other mainland real estate stocks have far exceeded the May levels, which are difficult to explain reasonably.

2. Automotive stocks continue to decline. As of the close, Great Wall Motor (02333) fell by 8.27%, closing at HK$13.98; Li Auto Inc-W (02015) fell by 6.94%, closing at HK$98.55; Xpeng-W (09868) fell by 6.81%, closing at HK$44.5.

According to reports, on Sunday (13th), local time, US Republican presidential candidate Trump elaborated on his trade policy on the program 'Sunday Morning Futures'. The former president proposed a new 'United States-Mexico-Canada Agreement' (USMCA) as part of his larger efforts to promote domestic employment and revitalize the automotive industry.

Trump claims that the US has been 'taken advantage of by Mexico, China, Canada, and the EU' in the past. He doesn't care whether a new agreement can be reached, but the US must rid itself of the North American Free Trade Agreement (NAFTA). Previously, Trump stated he would impose new tariffs to prevent Chinese auto manufacturers from producing cars in Mexico and exporting them to the US. Trump had said he would impose tariffs as high as 200%, hinting this time at possibly higher tariffs.

3. Petroleum stocks all declined. As of the close, CNOOC (00883) fell by 4.22%, closing at HK$19.3; PetroChina (00857) fell by 3.12%, closing at HK$6.21; Sinopec (00386) fell by 2.25%, closing at HK$4.77.

Overnight international oil prices fell over 2%, with intraday declines exceeding 5%. OPEC has lowered its global oil demand growth forecast for the third consecutive month. OPEC expects global crude oil demand growth to be 1.93 million barrels per day in 2024, down from the previous forecast of 2.03 million barrels per day. It also forecasts global crude oil demand growth to be 1.64 million barrels per day in 2025, lower than the previous expectation of 1.74 million barrels per day. Additionally, there are reports that Israel may avoid attacking Iran's oil infrastructure, easing concerns about tensions in the Middle East.

Non-ferrous metals are under significant pressure. By the close, CMOС Group Limited (03993) fell by 6.17% to HK$7; Jiangxi Copper (00358) dropped by 5.57% to HK$14.58; Ganfeng Lithium (01772) decreased by 5.44% to HK$20; Zijin Mining Group (02899) declined by 4.51% to HK$16.5.

Due to US CPI exceeding expectations in September, the bond market expects the Fed to only cut rates by 45 basis points this year, while the options market bets that there might be only one more rate cut this year, possibly 25 basis points, before pausing until next year. The US dollar continues its recent uptrend, reaching a 10-week high on the 14th, putting pressure on dollar-denominated commodities including precious metals. HTSC pointed out that with policies continuing to strengthen, at current price levels, there may be some differentiation in the fundamental situation of commodities like copper and aluminum. Investors are advised to pay attention to the risk of increased demand due to high copper prices.

Semiconductor sector surged and then fell. By the close, Hua Hong Semiconductor (01347) dropped by 5.62% to HK$21.85; Solomon Systech (02878) fell by 5.36% to HK$0.53; Shanghai Fudan (01385) decreased by 3.88% to HK$15.86; Semiconductor Manufacturing International Corporation (00981) declined by 1.88% to HK$26.15.

In September this year, South Korea's semiconductor exports amounted to $13.63 billion, a historical high, up by 36.3% year-on-year, with memory chip exports surging by 60.7% to $8.72 billion. Analysts point out that the South Korean chip market has always been seen as a bellwether for the global semiconductor industry. South Korean chip exports and inventory data indicate that with the stimulus of AI computing demand, the recovery momentum in the global semiconductor market is expected to further continue.

According to reports, the US government has discussed restricting Nvidia and other US companies from selling advanced AI chips to certain countries. The new plan will set limits on export licenses for certain countries. Officials are focusing on Gulf countries, which have a growing interest and strong financial resources for AI data centers.

Popular fluctuating stocks

CH General Edu (02175) resumed trading with a sharp drop. By the close, it fell by 53.7% to HK$1.44.

Ch General Edu Co., Ltd. has been suspended from trading since 9:00 a.m. on November 29, 2022, for nearly 2 years. As the resumption conditions have fully met the requirements of the Hong Kong Stock Exchange, including the issuance of the 2022 and 2023 annual performance reports, it resumed trading this morning. In June this year, the company released its interim performance for the six months ended February 29, 2024, with revenue of approximately 1.84 billion yuan, a year-on-year increase of 2.5%; net profit of about 67.6 million yuan, a year-on-year decrease of 15.3%.

Cm Hi-Tech (02115) rose throughout the day. By the close, it was up 14.5% at 0.229 Hong Kong dollars.

Cm Hi-Tech announced an agreement to privatize MayAir HK Holdings Limited. Under the plan, the planned shares will be cancelled in exchange for cash of 0.25 yuan per planned share, representing a premium of approximately 25% over the pre-suspension closing price of 0.2 Hong Kong dollars. The offeror is fully owned by Meier Technologies, whose shares are listed on the Science and Technology Innovation Board of the Shanghai Stock Exchange.