The three major Hong Kong stock indices faced renewed pressure and declined, with the Hang Seng Tech Index performing the worst, falling over 2% intraday. At the close, the Hang Seng Index dropped 1.11%, or 287.55 points, to 25,675.18, with a total turnover of HK$292.72 billion. The Hang Seng China Enterprises Index fell 1.07% to 8,597.97, and the Hang Seng Tech Index decreased 1.95% to 4,844.94. Huatai Securities noted that the Hong Kong market still faces two major external challenges. On one hand, the impact of the oil supply shock is nearing a critical point of concentrated release. On the other hand, inflation expectations are pushing up global sovereign bond yields, and monetary policy has limitations in addressing supply shocks. Internally, the positioning of southbound capital still needs to be unwound. The firm suggests navigating valuation and liquidity headwinds by focusing on earnings certainty, positioning along two main themes: cash flow certainty and industry trend certainty.
Among blue-chip stocks, CHINA TELECOM (00728) led the gains. At the close, it rose 6.02% to HK$5.64, with a turnover of HK$1.022 billion, contributing 6.72 points to the Hang Seng Index. On May 17, CHINA TELECOM launched a series of trial commercial Token packages. This is a nationwide Token business package. It is reported that in recent months, several provincial (municipal) branches of telecom operators have gradually implemented market-level practices. For example, on May 16, Shanghai Telecom launched a Token package system, becoming the first operator in Shanghai to release such packages. Regarding other blue chips, China Unicom (00762) rose 3.79% to HK$7.94, contributing 2.85 points; Lenovo Group (00992) gained 1.69% to HK$12.63, contributing 2.28 points; Li Auto-W (02015) plunged 14.15% to HK$64.9, dragging the index down by 23.52 points; Xinyi Solar (00968) fell 5.02% to HK$2.84, dragging the index down by 1.04 points.
In terms of market sectors, most major tech stocks declined, with Tencent falling over 1% and Alibaba down 0.45%. The three major telecom operators defied the market downturn and strengthened, buoyed by news of Token service launches, with CHINA TELECOM surging over 6%. Tensions between the US and Iran resurfaced, pushing oil & gas and coal stocks higher. Strong earnings from domestic memory chip giant ChangXin Technology boosted GIGADEVICE (03986), which rose over 8% to a new high. On the other hand, mainland property stocks led the declines; gold stocks remained under pressure due to rising US Treasury yields; automotive stocks, pork concept stocks, airline stocks, and innovative drug concept stocks were also among the top decliners.
1. The three major telecom operators were active against the market trend. At the close, CHINA TELECOM (00728) rose 6.02% to HK$5.64; China Unicom (00762) gained 3.79% to HK$7.94; China Mobile (00941) edged up 0.23% to HK$86.4. On May 17, CHINA TELECOM announced the launch of a series of trial commercial Token packages. Targeting developers and small-to-medium enterprise clients, it provides an integrated service of "Token + Connectivity + Security," introducing three tiers of Token Plans and two optional add-on services: broadband uplink acceleration and security protection. The monthly fees are 39.9 yuan, 159.9 yuan, and 299.9 yuan respectively, with corresponding monthly Token quotas of 15 million, 70 million, and 150 million. Recently, CHINA TELECOM's Ningxia branch issued a tender announcement for the centralized procurement project of its "Token Factory" generation capacity service for 2026, specifically for the second package (second round). This is the first 10-billion-yuan-level centralized procurement project named "Token Factory" among the three major operators. Currently, all three major operators are gradually transitioning from "traffic business" to "computing power business," rolling out a series of innovative computing power services. For instance, China Mobile's Beijing company launched a "Computing Power Token Package" for individual users, charging based on Token usage and pay-as-you-go; China Unicom has also introduced a computing power fusion subscription package.
2. Oil & gas and coal stocks rose. At the close, Yankuang Energy (01171) gained 3.18% to HK$14.93; Shandong Molong (00568) rose 2.45% to HK$6.69; Sinopec Oilfield Service (01033) increased 1.35% to HK$0.75. Market concerns over renewed escalation in US-Iran tensions pushed Brent crude futures above $110 per barrel at one point. Reports indicate that former US President Trump is expected to meet with key members of his national security team in the White House Situation Room on the 19th to discuss options for military action against Iran. According to Israeli media on the 17th, Israeli Prime Minister Netanyahu spoke with Trump by phone that day to discuss the possibility of resuming military operations against Iran. TD Securities stated that with rapid declines in crude oil inventories in China and the US, coupled with intensifying refined product supply tightness, Brent crude prices could surge to $150 per barrel, breaking the recent market calm.
3. Mainland property stocks were among the top decliners. At the close, Guangzhou R&F Properties (02777) fell 7.14% to HK$0.39; C&D International Group (01908) dropped 6.17% to HK$16.41; China Overseas Land & Investment (00688) declined 3.57% to HK$15.92. In April, the online signing area for second-hand homes in 11 cities increased 9% year-on-year, maintaining relatively high transaction volume, while the decline in housing prices narrowed. Huachuang Securities pointed out that the property market showed resilience in April, mainly due to the natural release of demand following lower purchase thresholds (including previous price declines and relaxed provident fund policies). However, they noted an inability to cross-verify sustained improvement in other domestic demand indicators, suggesting that subsequent home purchase demand may become insufficient after a concentrated release. Notably, the latest PBOC data shows that household loans decreased by 786.9 billion yuan in April, a year-on-year decline of 265.3 billion yuan more. Among these, medium to long-term household loans fell by 340.8 billion yuan in April, a year-on-year decline of 217.7 billion yuan more and a sequential decrease of 636.1 billion yuan, directly indicating a comprehensive contraction in mortgage demand.
4. Gold stocks remained under pressure. At the close, Lingbao Gold (03330) fell 4.64% to HK$18.91; Chifeng Gold (06693) dropped 4.62% to HK$35.9; Zijin Mining (02899) declined 2.1% to HK$34.42. Suppressed by the simultaneous rise in US Treasury yields and the US dollar index, the precious metals sector experienced a significant correction. On the morning of May 18, spot gold once fell below $4,500 per ounce for the first time since late March. As of writing, the US 10-year Treasury yield has risen above 4.6%, the highest level since February 2025; the US 30-year Treasury yield has climbed to 5.128%. Currently, the market is pricing in the possibility of a Fed rate hike. Data from the London Stock Exchange Group shows that US money markets currently price in a 64% probability of a 25 basis point rate hike by year-end and fully price in one rate hike by March 2027.
Among notable individual movers, Yifei Technology (06871) surged on its debut. At the close, it soared 76.23% to HK$53.75. The robotics manufacturer focused on light industrial application scenarios officially listed today. The public offering portion of the company was oversubscribed by approximately 14,855.40 times, significantly surpassing the historical record of 11,464 times set by last year's GEM newcomer Jinye International, officially topping the list of Hong Kong IPO oversubscriptions. Shenghong Technology (02476) performed strongly, closing up 8.47% at HK$368.8. The Shanghai Stock Exchange announced on May 15 that, as Shenghong Technology's price stabilization period in the Hong Kong market will end on May 16, 2026, and its corresponding A-shares will have been listed for 10 trading days, adjustments will be made to the list of southbound trading targets under the Shanghai-Hong Kong Stock Connect in accordance with relevant regulations, effective from the next trading day. GIGADEVICE (03986) hit a new high, closing up 8.09% at HK$588. Domestic memory chip giant ChangXin Technology updated its IPO prospectus, revealing that its performance far exceeded expectations due to the rapid rise in DRAM product prices. ChangXin Technology forecasts a net profit attributable to shareholders of 50 billion to 57 billion yuan for the first half of 2026, representing a substantial year-on-year increase of 2,244.03% to 2,544.19%. According to the prospectus, GIGADEVICE's latest shareholding ratio is 1.8%. Furthermore, GIGADEVICE's Chairman Zhu Yiming also serves as the Chairman of ChangXin Technology. Yangtze Optical Fibre and Cable (06869) rose throughout the day, closing up 7.89% at HK$240.6. According to the People's Daily, exports of several optical fiber, cable, and optical module products grew by double digits year-on-year in the first quarter, with order backlogs at many companies extending to 2028. In early May, a fiber optic manufacturer in Nantong, Jiangsu province, saw the price of its specialty fiber product (G.657.A2 fiber) increase tenfold within a year, with demand still outstripping supply. Orders grew fourfold year-on-year, and customers needed to pay deposits in advance to secure factory capacity. Li Auto-W (02015) saw its stock price plummet, closing down 14.15% at HK$64.9. Li Auto recently officially launched its embodied intelligent flagship SUV—the all-new Li L9. The new vehicle is available in two versions: Ultra and Livis. The Ultra version has a nationwide unified retail price of 459,800 yuan, and the Livis version is priced at 509,800 yuan nationwide, with deliveries officially commencing from May 17. Citi believes that the final price of the L9 Livis version is 70,000 yuan lower than the pre-sale price. While this may seem surprising, the bank views its actual cost-performance ratio as only on par with peers in the same class, not a game-changer.
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