"Market Review" Hong Kong stocks rise alongside A-shares, China Life and LI NING up over 4%

Hong Kong stocks rose in the afternoon, following the upward momentum of A-shares. The U.S. reported an increase of 64,000 non-farm jobs in November, better than expected, but October retail sales were flat and below expectations. The Dow Jones Industrial Average fell 302 points or 0.6% overnight, while the Nasdaq rose 0.2%. At the time of writing, the yield on U.S. 2-year bonds rose to 3.506%, and the yield on U.S. 10-year bonds rose to 4.167%. The U.S. dollar index increased to 98.54. Dow futures were up 24 points or 0.05%, and Nasdaq futures were up 29 points or 0.12%. The Shanghai Composite Index rose 45 points or 1.2% to close at 3,870 points, the Shenzhen Component Index rose 2.4%, and the ChiNext Index rose 3.4%, with a total trading volume of 1.81 trillion yuan in the Shanghai and Shenzhen markets.

The Hang Seng Index opened up 8 points, initially fell 67 points to a low of 25,168 points before rebounding, and in the afternoon, it rose 259 points to a high of 25,494 points. It closed up 233 points or 0.9% at 25,468 points; the Hang Seng China Enterprises Index rose 85 points or 1% to close at 8,843 points; the Hang Seng Tech Index rose 55 points or 1% to close at 5,457 points. The total trading volume for the day decreased to 183.141 billion yuan. The total trading volume of northbound funds was 79.624 billion yuan, while southbound funds had a net inflow of 7.909 billion yuan today.

Alibaba (09988.HK), Tencent (00700.HK), JD.com (09618.HK), and Bilibili (09626.HK) rose between 1.1% and 1.4%, while Meituan (03690.HK) and Kuaishou (01024.HK) rose 1.8% and 1.7%, respectively. Chinese financial stocks performed well, with China Life (02628.HK) and Ping An (02601.HK) rising 4.3% and 3%, respectively, and brokerage stock CITIC Securities (06030.HK) rising 3.4%.

【Insurance stocks rise, Changfei surges 20%】

One of the "four domestic GPU dragons," Muxi Co., Ltd. (688802.SH), debuted on the Shanghai Stock Exchange's Sci-Tech Innovation Board, with its stock price soaring 6.9 times to close at 829.9 yuan, giving it a market capitalization of 332 billion yuan, resulting in a paper profit of over 360,000 yuan for a single lot of 500 shares. Additionally, another of the "four domestic GPU dragons," the mainland AI chip manufacturer Birun Technology, has passed the listing hearing at the Hong Kong Stock Exchange, with earlier reports indicating that it may launch its IPO within the month and list in January next year, aiming to raise over 300 million USD.

In the chip sector, SMIC (00981.HK) rose 2% to close at 64.75 yuan, and Hua Hong (01347.HK) rose 2.9% to close at 68.2 yuan. Furthermore, Changfei Optical Fiber and Cable (06869.HK) surged 21.2% to close at 46.52 yuan, with a trading volume of 3.078 billion yuan.

【Over a thousand stocks rose, LI NING stands out】 The Hong Kong stock market has turned positive, with a rise and fall ratio of 29 to 18 for main board stocks (compared to 11 to 39 the previous day). There were 1,219 rising stocks (an increase of 2.3%), and among the Hang Seng Index constituent stocks, 60 rose while 27 fell, resulting in a rise and fall ratio of 67 to 30 (compared to 8 to 91 the previous day). The market recorded short selling of HKD 37.893 billion today, accounting for 23.243% of the total turnover of shortable stocks, which was HKD 163.032 billion.

State media quoted a senior official from the Central Financial Office stating that expanding domestic demand is the top priority task for next year, emphasizing the need to continuously strengthen efforts to expand domestic demand. Some domestic demand stocks received support, with travel platform Tongcheng (00780.HK) rising 3.4%. Retail stock Pop Mart (09992.HK) also rose 3.4%. Sportswear stock Li Ning (02331.HK) increased by 4.3% to close at HKD 19.07.

Daiwa reported that although Li Ning's stock price has outperformed its peers since its recent low, the firm observed that there are still widespread concerns in the market regarding its operational turnaround expectations, mainly due to continued weak sales performance in the third and fourth quarters of 2025. However, the firm noted several signs of a significant rebound in brand popularity over the past few weeks, which has strengthened their confidence in the brand's turnaround in 2026. They reiterated a buy rating on Li Ning, maintaining a target price of HKD 24. After raising their marketing expenditure estimates, they adjusted Li Ning's earnings per share forecasts for 2025 to 2027 down by 1% to 2%. Li Ning remains their top choice among sports brands. Since late November, Daiwa believes that Li Ning's brand popularity has significantly increased due to intensive new product launches and increased brand exposure