Hong Kong stocks close (07.30) | Hang Seng Index rises 0.2% AI hardware stocks continue to decline New Oriental-S (09901) surges nearly 19% after earnings

According to Zhitong Finance APP, the Federal Reserve kept interest rates unchanged but there are clear internal hawkish divisions. Meanwhile, the conflict between the U.S. and Iran has escalated again, causing oil prices to surge. Hong Kong stocks opened high but closed lower today, with the Hang Seng Index successfully turning positive at the end of trading. By the close, the Hang Seng Index rose 0.2% or 50.96 points, closing at 25,858.88 points, with a total turnover of HKD 304.894 billion; the Hang Seng China Enterprises Index rose 0.25%, closing at 8,644.71 points; the Hang Seng Tech Index fell 1.25%, closing at 4,803.77 points.

Everbright Securities believes that the current market has adequately reflected negative factors, such as the ongoing escalation of the U.S.-Iran geopolitical conflict and the valuation digestion pressure in the AI sector. However, the overall domestic economic fundamentals remain weak, and the strength of China's economic recovery and the sustainability of corporate profits still require more data for verification. The market lacks the key driving force to initiate a trending market. Currently, the Hong Kong stock market, especially the Hang Seng Tech Index, is in a complex bottoming phase.

Blue Chip Performance

New Oriental-S (09901) led the blue chips. By the close, it rose 18.84%, closing at HKD 47.44, with a turnover of HKD 708 million, contributing 8.75 points to the Hang Seng Index. New Oriental's revenue for the fourth fiscal quarter was USD 1.53 billion, a year-on-year increase of 23%, exceeding expectations, mainly driven by strong growth in its core education business; net profit attributable to shareholders was USD 62.2 million, up 775.8% year-on-year. Looking ahead to the 2027 fiscal year, the company expects net revenue to be between USD 6.45 billion and USD 6.68 billion, with a year-on-year growth rate of between 14% and 18%.

In other blue chip stocks, JD Logistics (02618) rose 3.62%, closing at HKD 15.16, contributing 2.15 points to the Hang Seng Index; CNOOC (00883) rose 2.89%, closing at HKD 24.18, contributing 16.2 points to the Hang Seng Index; SMIC (00981) fell 7.74%, closing at HKD 62, dragging down the Hang Seng Index by 33.35 points; China National Pharmaceutical Group (01177) fell 3.25%, closing at HKD 5.06, dragging down the Hang Seng Index by 2.68 points.

Popular Sectors

On the market, large tech stocks showed mixed performance, with Alibaba falling over 1% and Tencent rising 1.16%. AI hardware stocks continued to retreat, while semiconductors and optical communications collectively declined. On the other hand, the tobacco concept stocks rose throughout the day as the national standard for heated tobacco was solicited for opinions; with the U.S.-Iran conflict reigniting, oil prices surged, and oil and gas stocks rose across the board; the education concept saw significant gains, with New Oriental's fourth fiscal quarter performance exceeding expectations, leading to a nearly 19% surge in stock price; a major meeting emphasized stabilizing live pig prices, with Muyuan Foods rising at the end of trading; domestic bank stocks, beer stocks, and insurance stocks were active.

Tobacco concept stocks were strong throughout the day. By the close, Huabao International (00336) rose 7.77%, closing at HKD 3.33; Smoore International (06969) rose 6.21%, closing at HKD 9.41; China Tobacco Hong Kong (06055) rose 5.91%, closing at HKD 25.1.

Following the launch of the mandatory national standard for heated tobacco on April 7, 2026, the National Tobacco Administration has organized and completed the draft for soliciting opinions on the national standard for heated tobacco, which was released on July 28, with the opinion solicitation period ending on September 26, 2026, and is expected to be officially implemented six months after the release CITIC Construction Investment believes that the formulation of national standards provides a technical basis for regulation, which may mean that the domestic market for HNB products will continue to advance towards liberalization. With the domestic market for HNB products moving forward, several tobacco supply chain companies have already taken the lead in laying out relevant segments of the industry chain, and are expected to benefit from the market opportunities brought about by the liberalization of HNB.

Oil and gas concept shows active performance. As of the close, CNOOC (00883) rose 2.89% to HKD 24.18; PetroChina (00857) rose 2.22% to HKD 10.15; Kunlun Energy (00135) rose 2.22% to HKD 7.37.

On Wednesday, Brent crude futures surged nearly 7%. As major airstrike operations in the Middle East resumed, hopes for an imminent end to the conflict between the U.S. and Israel with Iran were dashed; at the same time, industry data showed a decline in U.S. crude oil inventories, further supporting the rise in oil prices. UBS analysts stated that the resumption of military strikes in the Middle East, along with Iranian officials reiterating their desire to control shipping activities in the Strait of Hormuz, where oil flow is currently sluggish, are factors that are pushing oil prices higher again. U.S. President Trump announced hours before the Federal Reserve's decision that he would implement retaliatory strikes against Iran, leading to a further increase in oil prices.

The five major banks all hit historical highs. As of the close, Agricultural Bank of China (01288) rose 3.01% to HKD 6.51; Industrial and Commercial Bank of China (01398) rose 2.14% to HKD 7.64; China Construction Bank (00939) rose 1.63% to HKD 9.36; Bank of China (03988) rose 1.09% to HKD 5.54.

With the interim report window approaching and hard technology facing the most severe sell-off of the year, funds are flowing towards dividend defense under weakened risk appetite. Meanwhile, the two institutions, State-owned Assets Supervision and Administration Commission and Chengtong Group, previously issued announcements to increase holdings, stabilizing market expectations. As several broad-based ETFs in China see concentrated volume, this also benefits the local profit-making effect in weighty sectors like banks. Zheshang Securities believes that bank stocks are entering a golden allocation window with a resonance of winning probability and odds in the second half of the year. In the long-term macro context of low interest rates and asset scarcity, bank stocks possess both "quasi-bond attributes" and "positive options for economic recovery," making them a scarce asset worth focusing on. If risk appetite changes subsequently, low-priced banks may welcome good allocation opportunities.

AI hardware stocks continue to retreat. As of the close, Cambridge Technology (06166) fell 12.9% to HKD 61.8; Yangtze Optical Fibre and Cable (06869) fell 10.51% to HKD 92; Hua Hong Semiconductor (01347) fell 8.26% to HKD 125.5; Kingboard Laminates (01888) fell 7.61% to HKD 29.14.

In the past month, AI trading has shown a significant cooling. The Philadelphia Semiconductor Index plummeted 5.33% overnight, marking the fifth consecutive trading day of decline, with a cumulative drop of about 15%. It has retreated 27% from the June peak, crossing the threshold of a technical bear market. Some analysts believe that in the context of extremely crowded AI hardware trading, concerns over debt financing, the enhancement of China's large model competitiveness, and breakthroughs in domestic equipment have combined to shatter the narrative of the "price increase bottleneck" in AI hardware. Coupled with deleveraging, global AI trading is experiencing widespread adjustments

Popular Volatile Stocks

Zhongji Xuchuang (03308) debuted below issue price. As of the close, down 2.04%, reported HKD 960.

Leading optical module company Zhongji Xuchuang today listed on the main board of the Hong Kong Stock Exchange, completing an "A+H" dual listing, raising the largest amount for a new stock in the Hong Kong market in 2026, setting a new IPO record for the year, and becoming the largest IPO in the Hong Kong market since Alibaba's return in 2019. On its first day of listing, the Hong Kong Stock Exchange launched monthly and weekly stock options, a privilege previously enjoyed by only a few companies such as Industrial and Commercial Bank of China, AIA, Xiaomi, and Alibaba.

Fosun International (00656) issued a profit warning. As of the close, up 7.88%, reported HKD 4.79.

Fosun International expects that the profit attributable to the parent company's shareholders for the first half of 2026 will be approximately RMB 1.5 billion to RMB 1.8 billion, a year-on-year increase of about 127% to 172%. The board believes that this growth is mainly due to the strong resilience shown by the core industries in the first half of 2026, steady improvement in operational quality, and significant growth in operational profits compared to the same period last year.

Sirius (09927) rose throughout the day. As of the close, up 7.33%, reported HKD 48.04.

The delivery ceremony for the Aito M6 user date was grandly held at the Chongqing Sirius Super Factory (Longxing). The successful completion of this delivery ceremony marks the official start of deliveries for the Aito M6 pure electric Max+. It is reported that the Aito M6 and the revamped Aito M9, which were recently launched, have shown certain blockbuster potential. The new generation Aito M9 series has achieved over 42,000 orders within a month of its launch, while the Aito M6 has delivered over 30,000 units in 54 days since its launch.

Muyuan Foods (02714) rose in the late session. As of the close, up 4.16%, reported HKD 33.58.

According to Xinhua News Agency, the Political Bureau of the Central Committee of the Communist Party of China held a meeting on July 30, emphasizing the stabilization of production and prices of live pigs and other agricultural and livestock products. Data released by the National Bureau of Statistics on July 16 showed that by the end of the second quarter, the national breeding sow inventory was 37.8 million heads, a year-on-year decrease of 2.63 million heads, down 6.5%, with the decline rate expanding by 3.2 percentage points compared to the first quarter