Economic Information Intermediary Ltd. (24th) special report: Chinese President Xi Jinping arrived in the United States and was received with high-level courtesy by U.S. President Trump. Markets are awaiting the outcomes of the Xi-Trump meeting. Market turnover reached only HK$82.2 billion in the morning session, and full-day turnover is likely to hit a recent monthly low. Amid sluggish trading volume and turbulence in the U.S. bond market, the U.S. September manufacturing PMI surged to 57, far exceeding expectations. Expectations for two consecutive months of U.S. interest rate hikes have intensified, dragging down the Hang Seng Index, which fell below its 10-day moving average (around 24,812) and continued to decline. The index dropped 129 points, or 0.5%, to close at 24,704 in the morning session. The Hang Seng China Enterprises Index closed at 8,235, down 38 points or 0.5%. The Hang Seng Tech Index fell 48 points, or 1.1%, to 4,330.
*Nie Zhenbang: Hang Seng Index weak, short-term support at 24,500*
Rising expectations for a U.S. rate hike next month caused major U.S. indices to retreat overnight. The Hang Seng Index opened 185 points lower, nearly at its intraday low, before narrowing losses to just a few dozen points later. Nie Zhenbang, Chief Analyst at High Wealth Securities Financial, told Economic Information Intermediary Ltd. that the Hang Seng Index had risen for three consecutive days from last Friday (18th) to this Tuesday (22nd), mainly driven by tech stocks and mainland financial stocks. Now, with rising expectations for U.S. rate hikes, tech stocks are under pressure, dragging down the Hang Seng Index. Although President Xi Jinping received a grand welcome in the U.S., earlier market rumors that senior corporate executives would join the delegation did not materialize, leading to more cautious sentiment toward the China-U.S. summit.
U.S. Treasury Secretary Bessent stated that the China-U.S. trade truce agreement expiring in November will be extended by two months, shorter than the previously rumored six-month extension proposed by the U.S. Nie Zhenbang noted that the shorter-than-expected extension of the trade truce, coupled with a temporary lack of other positive market expectations, adds pressure to the Hang Seng Index. However, it is expected that both sides still hope to achieve substantive outcomes through talks, including China’s request for the U.S. to halt arms sales to Taiwan in exchange for China mediating an Iran-U.S. agreement, as well as mutual tariff reductions on $30 billion worth of goods. On AI security, both sides are expected to explore the possibility of establishing a security notification mechanism, though reaching an agreement is anticipated to be difficult.
Nie Zhenbang believes that rising expectations for a U.S. rate hike next month have pressured overnight Wall Street tech stocks, inevitably affecting Hong Kong tech stocks. However, given that Hong Kong stock valuations are currently low, even if they follow external market declines, the downside is expected to be limited. Even if AI-related概念股 pull back, since most are not Hang Seng Index constituents, their impact on the index is expected to be minimal. With the Mid-Autumn Festival holiday approaching, the Stock Connect will suspend trading tomorrow, and the National Day Golden Week begins in the latter part of next week. Investor appetite is expected to remain low ahead of the holidays. With low trading volume, the Hang Seng Index is expected to trade in a narrow, weak range, with initial support at 24,500.
*Xiaomi's outlook for second-half earnings decline remains unchanged*
Xiaomi (01810) held its autumn new product launch event on Wednesday (23rd), unveiling the Xiaomi 18 Pro series smartphones, priced from RMB 5,999, with actual prices starting from RMB 5,499 after trade-in subsidies. The transparent special edition is priced from RMB 9,999. The Xiaomi Pro Max series starts at RMB 6,999, with the Pro Max transparent special edition (16GB+1TB) priced at RMB 10,999. The event also launched the Xiaomi Pad 9 series, Xiaomi Watch S5 series, Xiaomi Band 11, and a range of new ecosystem technology products.
Nie Zhenbang noted that Xiaomi phones have traditionally won favor through affordability. Although the new 18 Pro series offers improved performance, prices have correspondingly increased, and consumer acceptance remains to be seen—future sales data will need to be observed. Although Xiaomi President Lu Weibing revealed that the initial retail sales volume of the flagship foldable phone Xiaomi 18 Fold, launched earlier this month, tripled compared to the previous generation. However, Nie Zhenbang pointed out that foldable phones offer a certain novelty appeal, so a strong initial sales surge is not surprising. But for the 18 Pro, a conventional model, matching the sales growth of the 18 Fold will be challenging.
Nie Zhenbang stated that Xiaomi's second-quarter revenue and profits both declined year-on-year, with smartphone shipments falling over 20% year-on-year. Unless the new phones unexpectedly sell extremely well, the outlook for second-half earnings remains unchanged—expecting continued year-on-year declines. Xiaomi's share price rose from the end of June to a peak of HK$32.4 in July before starting to weaken, and has recently traded sideways. Nie Zhenbang believes Xiaomi's share price is likely to remain range-bound between HK$25 and HK$29, with no clear positive catalysts for a breakout in sight. However, the current level around HK$26 remains relatively safe, and even if it declines, the downside space is expected to be limited. (vs)
*Nie Zhenbang: Hang Seng Index weak, short-term support at 24,500*
Rising expectations for a U.S. rate hike next month caused major U.S. indices to retreat overnight. The Hang Seng Index opened 185 points lower, nearly at its intraday low, before narrowing losses to just a few dozen points later. Nie Zhenbang, Chief Analyst at High Wealth Securities Financial, told Economic Information Intermediary Ltd. that the Hang Seng Index had risen for three consecutive days from last Friday (18th) to this Tuesday (22nd), mainly driven by tech stocks and mainland financial stocks. Now, with rising expectations for U.S. rate hikes, tech stocks are under pressure, dragging down the Hang Seng Index. Although President Xi Jinping received a grand welcome in the U.S., earlier market rumors that senior corporate executives would join the delegation did not materialize, leading to more cautious sentiment toward the China-U.S. summit.
U.S. Treasury Secretary Bessent stated that the China-U.S. trade truce agreement expiring in November will be extended by two months, shorter than the previously rumored six-month extension proposed by the U.S. Nie Zhenbang noted that the shorter-than-expected extension of the trade truce, coupled with a temporary lack of other positive market expectations, adds pressure to the Hang Seng Index. However, it is expected that both sides still hope to achieve substantive outcomes through talks, including China’s request for the U.S. to halt arms sales to Taiwan in exchange for China mediating an Iran-U.S. agreement, as well as mutual tariff reductions on $30 billion worth of goods. On AI security, both sides are expected to explore the possibility of establishing a security notification mechanism, though reaching an agreement is anticipated to be difficult.
Nie Zhenbang believes that rising expectations for a U.S. rate hike next month have pressured overnight Wall Street tech stocks, inevitably affecting Hong Kong tech stocks. However, given that Hong Kong stock valuations are currently low, even if they follow external market declines, the downside is expected to be limited. Even if AI-related概念股 pull back, since most are not Hang Seng Index constituents, their impact on the index is expected to be minimal. With the Mid-Autumn Festival holiday approaching, the Stock Connect will suspend trading tomorrow, and the National Day Golden Week begins in the latter part of next week. Investor appetite is expected to remain low ahead of the holidays. With low trading volume, the Hang Seng Index is expected to trade in a narrow, weak range, with initial support at 24,500.
*Xiaomi's outlook for second-half earnings decline remains unchanged*
Xiaomi (01810) held its autumn new product launch event on Wednesday (23rd), unveiling the Xiaomi 18 Pro series smartphones, priced from RMB 5,999, with actual prices starting from RMB 5,499 after trade-in subsidies. The transparent special edition is priced from RMB 9,999. The Xiaomi Pro Max series starts at RMB 6,999, with the Pro Max transparent special edition (16GB+1TB) priced at RMB 10,999. The event also launched the Xiaomi Pad 9 series, Xiaomi Watch S5 series, Xiaomi Band 11, and a range of new ecosystem technology products.
Nie Zhenbang noted that Xiaomi phones have traditionally won favor through affordability. Although the new 18 Pro series offers improved performance, prices have correspondingly increased, and consumer acceptance remains to be seen—future sales data will need to be observed. Although Xiaomi President Lu Weibing revealed that the initial retail sales volume of the flagship foldable phone Xiaomi 18 Fold, launched earlier this month, tripled compared to the previous generation. However, Nie Zhenbang pointed out that foldable phones offer a certain novelty appeal, so a strong initial sales surge is not surprising. But for the 18 Pro, a conventional model, matching the sales growth of the 18 Fold will be challenging.
Nie Zhenbang stated that Xiaomi's second-quarter revenue and profits both declined year-on-year, with smartphone shipments falling over 20% year-on-year. Unless the new phones unexpectedly sell extremely well, the outlook for second-half earnings remains unchanged—expecting continued year-on-year declines. Xiaomi's share price rose from the end of June to a peak of HK$32.4 in July before starting to weaken, and has recently traded sideways. Nie Zhenbang believes Xiaomi's share price is likely to remain range-bound between HK$25 and HK$29, with no clear positive catalysts for a breakout in sight. However, the current level around HK$26 remains relatively safe, and even if it declines, the downside space is expected to be limited. (vs)
