Weekly | Bearish Tsunami Hits: HSI Slumps Sharply!

This week, Hong Kong stocks ended a four-week rebound streak, with the $HSI(HSI)$ dropping 3%!

Key Drivers of the Slump

- Over the weekend, the National Bureau of Statistics reported that the official manufacturing PMI for August fell to 49.1 from 49.4 in July, a larger drop than expected.

- On Wednesday, Caixin released the August Caixin China Services PMI, which decreased from 52.1 in July to 51.6, showing a slower expansion rate.

- Internationally, U.S. economic data came in weaker than expected. The ISM Manufacturing PMI for August was 47.2, below the forecast of 47.5 and the previous 46.8. This marks the fifth consecutive month of decline, reaching its lowest level since November last year.

As a result, concerns about a U.S. economic downturn intensified, leading to a sharp drop in U.S. stocks and impacting Hong Kong stocks as well.

Under these negative conditions, only the financial sector saw a slight increase this week, while other sectors fell:

Southbound funds saw a net inflow of HK$9.26 billion this week.

Key Events in Hong Kong Stocks This Week

1. New energy vehicle makers announced August sales, with $LEAPMOTOR(09863)$ surpassing the 30,000-unit mark.

2. $SANERGY GROUP(02459)$ experienced a dramatic flash crash, with its stock plunging 99% at one point.

3. $BABA-W(09988)$ Taobao will fully support $TENCENT(00700)$ WeChat Pay.

4. $NIO-SW(09866)$ reported its Q2 earnings with revenue of ¥17.45 billion, a 98.9% increase year-over-year, exceeding expectations.

5. $GUOTAI JUNAN I(01788)$ plans to absorb Haitong Securities.

6. Trading on the Hong Kong Stock Exchange was suspended all day Friday due to a typhoon.

7. Bloomberg reported that China is considering a two-step reduction in existing mortgage rates, with the first cut possibly occurring in the coming weeks.

8. The Monetary Policy Committee of the PBC mentioned that deposit and loan rates face constraints due to shifts to asset products and narrowing bank margins.

Three Stocks Worth Attention Among Top Trading HK Stocks This Week

Top 1: $SANERGY GROUP(02459)$ experienced a dramatic flash crash with its stock price plummeting 99%. The Hong Kong SFC flagged risks related to stock concentration.

Top 6: $CNOOC(00883)$ saw its stock price decline following a sharp drop in oil prices due to investor concerns about a U.S. economic slowdown.

Top 9: $NIO-SW(09866)$ , which reported Q2 revenue of ¥17.45 billion, a 98.9% year-over-year increase, saw its U.S. stock rise 14.39% after the announcement.

Next Week's Hong Kong Stock Market Events

1. Next Monday, China will release August CPI and PPI data. Economists forecast a 0.75% year-over-year increase in CPI and a 1.5% year-over-year decline in PPI.

2. Next Wednesday, China will publish August M2, new RMB loans, and total social financing data.

3. Next Wednesday, the U.S. will release August CPI data, with economists predicting a 2.6% year-over-year increase.