Hong Kong Stocks Close | Three Major Indices Post Weekly Declines; IPO Performance Draws Attention

Cailian Press, October 10 (Editor Hu Jiaring) The three major indices of Hong Kong stocks collectively adjusted this week. As of the market close, the Hang Seng Index fell by 3.13% cumulatively to 26,290.32 points; the Technology Index dropped by 5.48% cumulatively to 6,259.75 points; the China Enterprises Index declined by 3.11% cumulatively to 9,358.32 points.

Specifically, the Hang Seng Index continued its adjustment trend since the National Day holiday, falling from last weekend to around 26,290 points today. During the same period, the Technology Index also followed a similar trajectory.

New shares performed impressively, with Jinye International surging over 300% on its first day.

Despite the adjustment in the Hong Kong stock market, the new share market remained heated this week, with two newly listed stocks standing out particularly.

Jinye International Group debuted on the Hong Kong stock market on Friday and closed up 330%, becoming the focus of attention. The stock received 11,464.72 times subscription during the public offering stage, setting a record for the highest oversubscription in Hong Kong stock history, showcasing the market's strong enthusiasm.

According to public information, Jinye International Group is a long-established Hong Kong electromechanical engineering contractor with a history dating back to 2006. Its main businesses include the installation and maintenance of heating, ventilation, and air conditioning systems, electrical installations, and water supply and drainage systems.

Changfeng Pharmaceuticals, another newly listed stock this week, also performed well. The company was listed on October 8, closing more than 160% higher on the first day, and as of Friday's close, it had risen cumulatively by 109.63%. Changfeng Pharmaceuticals focuses on the research, production, and commercialization of inhalation technology and inhaled drugs, primarily treating respiratory diseases.

Today's Market

As of Friday's performance, the three major indices continued their recent consolidation trend. By the close, the Hang Seng Index fell 1.73%, the Technology Index dropped 3.27%, and the China Enterprises Index declined 1.80%.

Specifically, shares in banking, insurance, and catering performed strongly, while those in gold, semiconductors, and lithium batteries weakened.

Banks and insurance stocks became safe havens for capital.

By the close, Agricultural Bank of China (01288.HK), China CITIC Bank (00998.HK), and Qingdao Bank (03866.HK) rose by 1.55%, 1.04%, and 0.96%, respectively.

By the close, China Taiping Insurance (00966.HK), China Pacific Insurance (02601.HK), and New China Life Insurance (01336.HK) increased by 3.57%, 3.02%, and 1.66%, respectively.

In terms of market news, the rotation of funds was related to banking and other sectors, with some capital shifting from technology stocks to dividend-paying stocks such as banks and insurance companies.

Catering stocks continued their upward momentum.

At the close of trading, Xiaocaiyuan (00999.HK), Nayuki's Tea (02150.HK), and Yum China (09987.HK) rose by 6.09%, 4.03%, and 3.63% respectively.

In terms of news, Xiaocaiyuan led the gains. The company delivered impressive results during the National Day holiday: In the first seven days, its national stores received a cumulative footfall of over 2.25 million customers, representing a year-on-year increase of 21%, continuing its high growth trend.

Ceasefire agreement triggers decline in gold stocks

At the close of trading, China Gold International (02099.HK), Chifeng Gold (06693.HK), and Zhaojin Mining (01818.HK) fell by 9.73%, 7.45%, and 7.43% respectively.

According to reports, on the evening of October 9 local time, Khalil Al-Haya, a senior official of Hamas and chief negotiator, issued a statement announcing the conclusion of a ceasefire agreement. The Israeli government approved the Gaza ceasefire agreement in the early hours of October 10.

Affected by this news, COMEX gold fell 1.95% overnight, closing at USD 3991.1. Its price has since recovered somewhat, hovering around USD 4000.

Baocheng Futures noted that the short-term ceasefire agreement reached between Israel and Hamas has led to a rapid easing of geopolitical tensions. Coupled with significant gains recorded earlier, there is a strong willingness among short-term bulls to unwind positions.

Most semiconductor stocks experienced adjustments.

At the close of trading, SMIC (00981.HK), Shanghai Fudan (01385.HK), and Hua Hong Semiconductor (01347.HK) fell by 7.13%, 5.98%, and 4.05%, respectively.

SMIC led the declines. On the news front, several brokerages recently adjusted the collateral conversion rate for SMIC shares held in margin accounts from 0.7 to 0.00, and for Biwin Storage from 0.5 to 0.00; the adjustment of stock conversion rates to zero is a unified action taken by brokerages.

Goldman Sachs stated that, with the development of local AI solutions—from models to semiconductors—SMIC and Hua Hong Semiconductor are expected to become China's leading wafer foundries and benefit in the long term.

Lithium battery stocks weakened.

At the close of trading, Ganfeng Lithium (01772.HK), Tianqi Lithium (09696.HK), and Tianneng Power (00819.HK) fell by 10.75%, 9.92%, and 9.47%, respectively.

On the news front, CATL led the declines. In a recent report, JPMorgan downgraded its rating for CATL’s H-shares from 'Overweight' to 'Neutral', citing that the current valuation is relatively reasonable; at the same time, it raised the target price by 13% to HKD 600. The analysts noted in the report that cornerstone investors holding nearly 50% of the issued H-shares will see their lock-up period expire on November 19, which could result in some selling pressure and create technical resistance above the price.

Stocks with notable movements

Fenbi rose over 5%, with institutions optimistic about the accelerated volume growth of AI problem-solving classes.

Fenbi (02469.HK) increased by 2.24%, once rising nearly 6% during the trading session. Huatai Securities previously noted that, with the upcoming national civil service exam in the second half of the year, AI problem-solving classes are expected to see an accelerated increase in sales volume, with the full-year sales projected to approach 200,000 participants. Considering the features of the new AI products—such as lower pricing, more personalized and efficient learning experiences, and greater resistance to piracy—they hold substantial competitive advantages and more stable profitability in the current market environment.

The bank believes that, in the medium to long term, AI products are expected to gradually replace traditional product formats and penetrate a broader base of long-tail users, driving user growth and raising the profitability ceiling.

China Duty Free Group fell over 3%, with institutions citing weak average daily sales performance during the Golden Week.

China Duty Free Group (01880.HK) dropped by 3.43%, closing at HKD 59.15. In terms of news, data released by Haikou Customs showed that during this year's National Day and Mid-Autumn Festival holiday period, Haikou Customs supervised offshore duty-free sales amounting to RMB 944 million, representing a year-on-year increase of 13.6%. HSBC issued a research report stating that the adjusted average daily sales during this year’s October Golden Week grew only 5% year-on-year.

The bank expects China Duty Free Group's revenue in the third quarter to decline by a mid-single-digit percentage year-on-year. Due to the low base effect, it anticipates that the revenue decline in the fourth quarter will narrow to a low single-digit percentage. However, the growth outlook after this year remains unclear.