Hong Kong stocks opened higher but trended downward today, with all three major indices closing in negative territory, as heavyweight tech stocks weakened alongside the innovative drug and mainland property sectors. At the close, the Hang Seng Index fell 0.73% or 170.49 points to 23,041.32, with turnover of HK$178.348 billion; the Hang Seng China Enterprises Index dropped 0.45% to 7,766.91; and the Hang Seng Tech Index declined 1.48% to 3,800.43.
Soochow Securities believes that persistent overseas risks are unsettling the market, with risk appetite remaining tight, affecting the pace of Hong Kong stock rebounds. 1) The US-Iran conflict remains volatile with risks of escalation; 2) As the US midterm elections approach, the market is gradually betting that Democrats will take both chambers, which could negatively impact future US AI policy and the US economy.
Performance of Blue-Chip Stocks
HSBC Holdings (00005) plunged after its earnings release. At the close, it fell 5.56% to HK$134.3, with turnover of HK$4.972 billion. HSBC Holdings' midday results came in below expectations, causing the stock price to drop sharply. Its third-quarter reported pre-tax profit was US$9.6 billion, up 32% year-on-year but slightly below the market estimate of US$9.7 billion; revenue increased by US$800 million from the third quarter of 2025 to US$18.6 billion, below the market estimate of US$18.93 billion. Net interest income was US$9.3 billion, an increase of US$500 million or 6% from the third quarter of 2025.
Among other blue-chip stocks, Li Ning (02331) rose 5.92% to HK$13.6; Lenovo Group (00992) gained 2.94% to HK$22.38; CSPC Pharmaceutical Group (01093) fell 3.89% to HK$7.91; and Hansoh Pharmaceutical (03692) declined 3.22% to HK$31.84.
Notable Sectors
On the board, heavyweight tech stocks broadly weakened, with Tencent Holdings down 0.31% and Alibaba down 0.97%. Capital shifted toward low-valuation, high-dividend names: mainland bank stocks bucked the trend, with Minsheng Bank up 2.75% and ICBC up 2.15%; coal and insurance stocks also recovered. On the other side, innovative drug stocks collectively sold off, with Keymed Bio down 14.38%; AI hardware stocks opened high but drifted lower; mainland property stocks, auto stocks, and solar stocks showed lackluster performance.
Coal and mainland bank high-dividend stocks advanced. At the close, Minsheng Bank (01988) rose 2.75% to HK$3.175; China Shenhua Energy (01088) gained 2.36% to HK$41.7; ICBC (01398) rose 2.15% to HK$7.6; and Postal Savings Bank of China (01658) edged up 1.29% to HK$5.515. Ping An Bank's third-quarter revenue and net profit continued the "double growth" trend from the first half, becoming the first listed bank to release its third-quarter report. CITIC Securities research estimates that listed banks' revenue and net profit attributable to parent companies are expected to grow 7.2% and 3.2% year-on-year respectively in the first three quarters. Changjiang Securities noted that bank stocks remain in a process of low-valuation repair and dividend value revaluation this year; market style and risk appetite will not change the direction of repair but will only affect the short-term pace. JPMorgan stated that amid recent volatility in Hong Kong and mainland markets, investor attention to defensive stock selection has increased, and if market conditions remain volatile, traditional Hong Kong utility stocks may outperform.
AI hardware stocks opened high but trended lower. At the close, SMIC (00981) fell 1.26% to HK$45.34; CIG Shanghai (06166) rose 0.15% to HK$68.9; and Zhongji Innolight (03308) gained 0.49% to HK$725. This morning, AI hardware stocks opened higher, driven by overnight gains in US stocks and sharp rises in Japanese and Korean chip stocks, before retreating with the broader market. Anthropic, the developer of Claude, officially released its IPO prospectus, with strong revenue growth data significantly alleviating market concerns about an "AI bubble" and reigniting the AI boom. Meanwhile, Meta is advancing a large-scale equity financing, SpaceX has obtained a GPU financing commitment, and the market expects AI capital expenditure to continue receiving funding support. It is worth noting that this week, multiple tech giants will release earnings in the US market, and the market will focus on the returns on infrastructure investment.
Innovative drug stocks led the declines. At the close, Keymed Biosciences-B (02162) fell 14.38% to HK$69.35; Lepu Biopharma (02157) dropped 5.31% to HK$3.3; and 3SBio (01530) declined 5.03% to HK$13.21. Industrial Securities noted that "innovation plus internationalization" remains the core theme for pharmaceuticals in 2026, and the valuation attractiveness of innovative drugs and the supply chain has become more prominent after the pullback. The innovative drug supply chain has entered the third-quarter earnings season, and rapid growth is expected to continue. HSBC Research is bullish on leading biotech stocks with global Phase III data releases expected next year, stable recurring business growth, and ample cash, and believes that China's CDMO sector has high growth visibility and a solid supply chain position, while medical devices and pharmacies are defensive choices.
Mainland property stocks came under broad pressure. At the close, Midea Real Estate (03990) fell 6.79% to HK$2.06; Sunac China (01918) dropped 6.06% to HK$0.465; and R&F Properties (02777) declined 5.91% to HK$0.191. According to BOC International, in the 43rd week (October 17-23), new home transaction area in 47 cities was 2.468 million square meters, down 14.9% week-on-week and 34.8% year-on-year, with the year-on-year decline widening by 10.7 percentage points from the 42nd week. The bank believes that overall, the traditional peak season of "Golden September and Silver October" combined with intensive policy introductions led to slight expectation improvement, driving some recovery in September's 70-city home prices. However, the bank believes that current short-term data changes are not sufficient to form a definitive trend, and subsequent market volume and price performance still needs close monitoring.
Notable Stock Movements
Z.AI (02513) showed strong momentum. At the close, it rose 8.90% to HK$550.5. AI unicorn Anthropic officially filed its S-1 document to sprint toward Nasdaq under the ticker "ANT." According to reports, Anthropic plans to conduct its IPO during the week of November 16. Anthropic is targeting a valuation of up to US$2 trillion, which, if successful, would become the largest IPO in history.
China Heartland Chemical Fertilizer (01866) rose after its earnings release. At the close, it gained 6.11% to HK$9.55. China Heartland Chemical Fertilizer announced its first three quarters' results, with operating revenue of 23.047 billion yuan, up 28% year-on-year, and net profit attributable to parent companies of 1.138 billion yuan, up 42% year-on-year. In the single third quarter, revenue was 7.307 billion yuan, up 38% year-on-year, and net profit attributable to parent companies was 217 million yuan, up 8% year-on-year; during the period, urea production increased by 780,000 tons year-on-year, and high-efficiency urea sales grew 17%.
Li Ning (02331) bucked the trend. At the close, it rose 5.92% to HK$13.6. Li Ning disclosed its latest operating conditions for the third quarter of this year and announced that a board meeting will be held on November 5 to consider declaring a special dividend to shareholders. Guosen Securities believes this will provide potential catalysts for medium- to long-term brand development and shareholder returns.
ZTE Corporation (00763) rose after its earnings release. At the close, it gained 4.40% to HK$19.94. ZTE Corporation announced that in the first three quarters, it achieved operating revenue of 116.838 billion yuan, up 16.23% year-on-year; net profit was 4.060 billion yuan, down 23.71% year-on-year. Third-quarter operating revenue was 38.813 billion yuan, up 33.99% year-on-year; net profit was 1.307 billion yuan, up 394.46% year-on-year and down 9% quarter-on-quarter.
Yue Yuen Industrial (00551) issued a profit warning. At the close, it fell 9.93% to HK$12.88. Yue Yuen Industrial expects profit attributable to owners of the company for the first three quarters of 2026 to decrease by approximately 50% to 55% year-on-year, mainly due to the footwear manufacturing business being affected by demand fluctuations, tariffs, macroeconomic uncertainty, increased labor costs driven by higher headcount and salary increases, and uneven capacity utilization.
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