The Hong Kong stock market opened higher but trended lower throughout the session, with the three major indices turning collectively negative in the afternoon. At the close, the Hang Seng Index was essentially flat, settling at 26,389.04 points, with a total daily turnover of HK$306.702 billion. The Hang Seng China Enterprises Index fell 0.2% to 8,858.63 points, while the Hang Seng Tech Index declined 0.35% to 5,076.2 points.
Dongwu Securities suggested focusing on value and dividend assets while also capturing opportunities from the diffusion of AI and growth elasticity. Xingye Securities noted that technology remains a key theme amid the ongoing AI narrative but cautioned that the current earnings and valuations of major tech companies are largely matched. Further valuation expansion may require earnings growth or more accommodative liquidity support.
Blue-chip performance was mixed. BABA-W (09988) advanced following its earnings report, closing up 3.84% at HK$137.9, contributing 78.03 points to the Hang Seng Index with a turnover of HK$24.092 billion. The Alibaba Group released its financial results for the fourth quarter and full fiscal year 2026. The report showed that its Cloud Intelligence Group revenue for the quarter reached RMB 41.626 billion, a year-on-year increase of 38%, with external commercial revenue growth accelerating to 40%. Group CEO Wu Yongming projected that the annualized recurring revenue (ARR) for AI model and application services, including the Bailian MaaS platform, would exceed RMB 10 billion in the June quarter and surpass RMB 30 billion by year-end. Furthermore, to meet substantial AI demand, future capital expenditures are expected to exceed the originally planned RMB 380 billion.
Among other blue chips, Li Auto-W (02015) rose 4.34% to HK$76.85, contributing 7.11 points. Orient Overseas (International) Limited (00316) gained 3.35% to HK$145, contributing 0.97 points. Conversely, Zijin Mining Group (02899) fell 4.12% to HK$37.22, dragging the index down by 15.22 points. SMIC (00981) declined 3.57% to HK$71.5, weighing on the index by 17.63 points.
Sector performance was varied. Major technology stocks were mixed, with Alibaba up nearly 4% post-earnings and Baidu gaining over 2%, while Tencent turned from gains to losses. Semiconductor stocks showed divergence, with the silicon carbide (SiC) concept particularly standout. SICC (02631) surged over 18% to hit a new high. Meanwhile, leading foundries SMIC and Huahong faced pressure. Additionally, hotter-than-expected U.S. inflation data fueled expectations of Federal Reserve rate hikes, leading to broad declines in gold stocks. The previously strong green power concept retreated, with DATANG POWER (00991) falling nearly 14%. PCB, CRO, and solar energy stocks also declined.
1. The silicon carbide (SiC) concept was a highlight. At the close, SICC (02631) surged 18.29% to HK$128.7. Hantian Tiancheng (02726) jumped 12.73% to HK$122.2. Overseas, leading SiC company Wolfspeed surged over 16% overnight, doubling its stock price within the month. According to reports, a significant report released on May 13 by the globally renowned AI supply chain research firm Citrini ignited the global SiC sector. Citrini's report explicitly identified silicon carbide as the most undervalued core theme in the AI field. The report's core argument is that AI power supply and AI infrastructure are mutually reinforcing, forming the foundational support for AI industry development, with silicon carbide being the key incremental component in AI power supplies. Whether in terms of efficiency requirements, technological compatibility, or supply chain maturity, silicon carbide holds irreplaceable advantages in high-voltage AI power supply scenarios.
2. Gold stocks generally declined. At the close, CHINAGOLDINTL (02099) fell 7.06% to HK$164.6. Lingbao Gold (03330) dropped 5.51% to HK$20.94. Zijin Mining Group (02899) declined 4.12% to HK$37.22. A surprising "hot" PPI inflation reading intensified expectations for Fed rate hikes, with market-implied probability of a 25-basis-point hike within the year rising to around 50%. Data released by the U.S. government on Wednesday showed the April PPI rose 6% year-on-year, the highest since December 2022, while the core PPI increased 5.2% year-on-year, both significantly exceeding market expectations. Energy and transportation costs climbed, and services inflation hit a four-year high. Additionally, the Senate had previously approved Wash's appointment as a Federal Reserve Governor for a 14-year term. With this chair appointment passed, Wash will officially assume the role after completing relevant White House signing procedures, succeeding current Chair Powell, whose term ends on May 15.
Notable movers included:
1. Naxin Micro (02676) hit another new high, closing up 10.07% at HK$207.6. Guosheng Securities believes the company's layout in the AI server field is primarily based on the power supply segment, covering products like digital isolators, drivers, interfaces, sampling, and current sensors for both primary and secondary power supplies. Benefiting from its accumulation in the broader energy sector, the company has already secured many leading AI server clients, with related revenue in Q1 2026 showing relatively fast year-on-year and sequential growth. As AI server power continues to increase, the firm expects the average selling price (ASP) of related power supply analog chips to maintain an upward trend.
2. ROBOSENSE (02498) remained strong throughout the session, closing up 8.83% at HK$34.5. In the first quarter of this year, RoboSense's robotics business surpassed its automotive LiDAR business for the first time, becoming the company's primary growth driver. A Morgan Stanley research report included RoboSense in both its "Global Humanoid Robot Industry Chain Top 100" and "China Humanoid Robot Value Chain" maps, recognizing its position as a core sensor supplier. This reflects international capital's positive view on its "automotive + robotics" dual-drive strategy and long-term growth potential in the robotics sector.
3. KINGSOFT CLOUD (03896) performed well, closing up 4.56% at HK$8.48. Amid strong anticipated AI demand, major tech companies continue to raise capital expenditure forecasts. Alibaba CEO Wu Yongming stated that currently, almost no server card in Alibaba's infrastructure is idle. Considering the massive investment required for building computing power centers, capital expenditures may exceed the initially announced RMB 380 billion. Tencent management also recently stated during an earnings call that demand for AI-related services is continuously growing, and capital expenditure in this area for this year will increase compared to last year, especially in the second half.
4. XFX Group (02473) fell sharply on heavy volume, closing down 16.67% at HK$0.7. XFX Group announced that the company, the seller Pearl Capital Resources Limited, and the placing agent entered into a placing and subscription agreement. Accordingly, the seller intends to place approximately 155 million existing shares to no fewer than six placees through the placing agent at a placing price of HK$0.82 per share, representing a discount of approximately 2.38% to the closing price of HK$0.84 per share on the last trading day on the Stock Exchange. The company will issue the same number of new shares to the seller at HK$0.82 per share, raising net proceeds of approximately HK$126 million, intended for further procurement of vehicles for the Group's main business and related purposes.
5. DATANG POWER (00991) retreated from recent highs, closing down 13.96% at HK$3.02. According to the Shanghai Securities News, on May 2, Datang Power's "Zhongwei Cloud Base Computing-Power Coordination Green Power Direct Supply Project" officially commenced operation, marking the nation's first large-scale computing-power coordination green power direct supply project. The project has a total scale of 2,000 MW, comprising 500 MW of photovoltaic power generation and 1,500 MW of wind power generation. On May 13, Datang Power issued a stock trading risk warning, stating that as of now, the company has no computing-power coordination projects that have been put into operation.
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