Home » Tech Stocks Mixed as Hang Seng Index Opens Lower; Tesla Soars and Chinese Concept Stocks Rise

Tech Stocks Mixed as Hang Seng Index Opens Lower; Tesla Soars and Chinese Concept Stocks Rise

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Title: Hang Seng Index Opens Slightly Lower; US Stocks Close Higher on Monday

The Hang Seng Index opened 0.09% lower today, with a mix performance of tech stocks. Baidu Group saw a rise of 0.72%, while Alibaba experienced a fall of 0.48%. In the concept of new energy vehicles, Xiaopeng Motors witnessed a decline of 4.55%.

In the overnight market review, US stocks closed higher on Monday. Due to the US Independence Day holiday, the stock market closed three hours earlier on Monday and remained closed on Tuesday. This week, the focus will be on important economic data, including non-farm employment. Data from Monday revealed that US manufacturing activity contracted for the eighth consecutive month in June. By the closing bell, the Nasdaq rose 0.21%, the S&P 500 gained 0.12%, while the Dow Jones increased by 0.03%.

Tesla, on the other hand, saw a remarkable increase of nearly 7%, reaching a new closing high since September 29, 2022. This surge represented the largest single-day increase since March 21, along with a market value rise of 400 billion. Q2 vehicle production and deliveries surpassed expectations, as per the data released on Sunday.

Large technology stocks experienced mixed results, with Apple falling 0.78%, Microsoft down 0.75%, Amazon declining 0.11%, Meta dropping 0.33%, Google rising 0.17%, Nvidia increasing 0.26%, and Netflix up by 0.22%.

Popular Chinese concept stocks generally saw a rise, as the Nasdaq China Golden Dragon Index increased by 2.12%. Alibaba rose by 0.91%, JD.com spiked by 2.99%, Pinduoduo saw a rise of 3.11%, Weilai Automobile increased by 3.46%, and Xiaopeng Automobile rose by 4.17%. Other notable increases include Auto (+3.42%), Bilibili (+4.17%), Baidu (+4.69%), Netease (+2.71%), and iQiyi (+1.12%).

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In terms of the Hong Kong stock market outlook, the CICC Research Report suggests that despite significant underperformance compared to major global markets, the Hong Kong stock market managed to stabilize last week due to undervaluation and expectations for more policy support in the future. However, the report also acknowledges the presence of domestic growth pressure and a weakened renminbi.

Looking at the domestic front, the latest economic data confirms the existence of pressure on economic growth. Externally, the better-than-expected performance of the US economy has raised expectations of the Federal Reserve resuming interest rate hikes in July, adding pressure on the RMB exchange rate. CITIC Securities released a research report for July, stating that the domestic economy is expected to continue its weak recovery, while overseas markets have already priced in the possibility of the Fed raising interest rates. Cracks in the US economy have also emerged, prompting short-term fund flows from large technology blue chips to value stocks.

In the Hong Kong stock market, three main areas are recommended for investors to focus on: stocks with high dividends, high ROEs (Return on Equity), and excellent free cash flow; the travel industry chain, particularly the aviation sector; and cost-effective biotechnology and internet leaders with AI layout.

In other news, the HKTDC report revealed that business sentiment in the Greater Bay Area suffered a temporary setback but is progressing towards a moderate recovery. Standard Chartered Bank and the Greater China Trade Development Council echoed this sentiment, stating that companies in the Greater Bay Area have not made significant moves to shift production capacity overseas.

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Additionally, the Hong Kong “Belt and Road” Summit Forum will feature a special session dedicated to the Middle East for the first time. Saudi Arabia’s Minister of Communications and Information Technology expressed a desire to strengthen cooperation with Hong Kong, while the Chief Executive of the Hong Kong SAR, Li Jiachao, emphasized Hong Kong’s commitment to revitalizing relations with Saudi Arabia and the United Arab Emirates.

Furthermore, the total value of retail sales in Hong Kong for May is provisionally estimated to be HK$34.5 billion, representing an 18.4% year-on-year increase. Online sales accounted for 6.3% of total retail sales. Looking ahead, the retail sector is expected to continue improving, with an anticipated rise in the seasonally adjusted value of total retail sales in the coming months.

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