To The Moon

The past week has been an exciting one! The $HSI(HSI)$ has surged for five consecutive trading days, posting an impressive 8.8% weekly gain, marking the biggest surge since October 2011!

On the news, there were no major positive announcements last week, and even some bearish news came from abroad. For instance, the US core PCE price index grew 3.7% in the first quarter, higher than the expected 3.4%. The market repeatedly pushed back the timeline for the Fed's rate cut in 2024, and the US stock market performed moderately last week.

But the Hong Kong stock market didn't seem to be fazed at all. Internet giants like $TENCENT(00700)$ $Tencent Holding Ltd.(TCEHY)$ and $MEITUAN-W(03690)$ $MEITUAN(MPNGF)$ even saw their share prices soar, with Tencent surging 15% and Meituan jumping 21.3%!

The rally might have something to do with foreign capital returning to the market. Coincidentally, on Tuesday, the international investment bank UBS released a research report, upgrading the rating of the MSCI China Index to overweight. The reason? The bear market in Hong Kong stocks is mainly due to valuation declines, not fundamental issues.

And looking at EPS for the internet and consumer industries, they've maintained growth in the past year and a half. The impact of the real estate crisis has been exaggerated. Plus, recent consumer data has shown a rebound, and industrial profits are also on the rise.

As for southbound funds, net purchases last week amounted to HK $10.3 billion, far less than the HK $23.1 billion and HK$ 32.1 billion bought in the previous two weeks. Clearly, the main driver of last week's rally was the return of foreign capital.

With the influx of funds, almost all sectors saw gains last week. Healthcare, real estate, and IT - sectors that had previously seen significant declines - led the way, while the previously strong telecom services sector lagged behind.

Key Events in Hong Kong Stocks Last Week

1. $Li Auto(LI)$ $LI AUTO-W(02015)$ lowered prices for all its models by 18,000 to 30,000 yuan.;

2. $TENCENT(00700)$ $Tencent Holding Ltd.(TCEHY)$ 's blockbuster mobile game "Dungeon and Fighter: Origin" (DNF Mobile Game) will be launched soon;

3. LPR interest rate remained unchanged in April;

4. China Securities Regulatory Commission supported the inclusion of RMB stock trading counters in Hong Kong Stock Connect;

5. Lei Jun announced that $XIAOMI-W(01810)$ $Xiaomi Corp.(XIACY)$ 's SU7 has received over 70,000 pre-orders;

6. UBS upgraded MSCI China index to overweight;

7. Hong Kong Exchanges and Clearing posted a net profit of HK $2.97 billion, down 13% from a year earlier.

8. Bitcoin spot ETF approved;

9. The National Press and Publication Administration released the approval information of domestic online games in April, with a total of 95 games approved;

10. U.S. Secretary of State Blinken's visited to China;

11. Us economic growth slowed sharply to 1.6% in the first quarter of 2024;

12. The US core PCE price index rose 3.7% in the first quarter, compared with an expected 3.4%.

Four Stocks Worth Attention Among Top Trading HK Stocks Last Week

Top1: $SENSETIME-W(00020)$ : the company released a large model SenseNova 5.0 last week, the comprehensive ability of the benchmark GPT-4 Turbo, the stock price soared;

Top2: $TENCENT(00700)$ $Tencent Holding Ltd.(TCEHY)$ : Tencent, $MEITUAN-W(03690)$ $MEITUAN(MPNGF)$ and other Internet companies in the absence of clear benefits and the suspension of buybacks, stock prices rose, causing investor concern;

Top6: $CHABAIDAO(02555)$ : the new tea drink landed in Hong Kong stocks, broke on the first day, the weekly decline of up to 32%, casting a shadow on the IPO of Hong Kong stocks;

Top7: $Li Auto(LI)$ $LI AUTO-W(02015)$ : the company announced the price reduction of all models, coupled with the newly released L6 model sales less than expected, the stock price fell sharply.

This week's Hong Kong stock market events

1. This Tuesday, China's official manufacturing PMI (April) data will be released, which can reflect the momentum of China's economic recovery and is expected to have a greater impact on the market;

2. The A-share market will be closed from Wednesday to Friday for Labor Day. Hong Kong stocks will be closed on May 1;

3. $Apple(AAPL)$ $Amazon.com(AMZN)$ and other giants will release financial results this week, which have an impact on related concept stocks in Hong Kong.