Hong Kong stocks rebounded by over 400 points, with power equipment stocks soaring. Dongfang Electric and Harbin Electric each rose by more than 10%

With hopes for a dawn in the Middle East geopolitical situation, the three major U.S. stock indices rebounded the night before (4th). The Fourth Session of the 14th National People's Congress opened this morning, with Premier Li Qiang delivering the government work report. Major stock markets in the Asia-Pacific region generally rebounded this morning (5th), with the Nikkei index rebounding by 2.7%, and South Korean stocks once surged by 12%, triggering a circuit breaker, now up by 9.9%. The mainland Shanghai and Shenzhen markets rebounded by 0.5% and 1.7%, respectively. After three consecutive days of decline, Hong Kong stocks rebounded this morning (5th), with the Hang Seng Index opening up 334 points, and the early gains expanded, currently reported at 25,685 points, up 435 points or 1.7%, with a turnover of HKD 97.44 billion.

Power equipment stocks collectively soared. Dongfang Electric (01072.HK) is currently reported at HKD 43.86, up 15.36%, with a turnover of HKD 869 million. Shanghai Electric (02727.HK) is currently reported at HKD 4.99, up 17.41%, with a turnover of HKD 650 million. Harbin Electric (01133.HK) is currently reported at HKD 28.66, up 11.43%, with a turnover of HKD 148 million. Northeast Electric (00042.HK) is currently reported at HKD 0.53, up 11.58%, with a turnover of HKD 7.6876 million. Both Dongfang Electric (600875.SH) A-shares and Shanghai Electric (601727.SH) A-shares are at the daily limit up.

CICC published a report indicating that Europe and the U.S. are facing power shortages, coupled with domestic computing power tokens going overseas, which could benefit power equipment companies. The firm noted that the power grid facilities in Europe and the U.S. are aging, and recent frequent blizzard warnings have increased the risk of power outages, believing that systemic risks are rising, and they remain optimistic about the global initiation of a major cycle of power investment. On the other hand, domestic electricity price cost advantages are becoming prominent, and domestic large models are capturing global market share, which is expected to open up opportunities for domestic computing power tokens to go overseas.

CITIC Construction Investment recently released a research report stating that the construction of AIDC has entered a period of rapid growth, estimating that the CAGR of electricity capacity demand brought by AI demand in the U.S. from 2025 to 2028 will be about 55%, with cumulative demand exceeding 150GW in the next three years, creating opportunities for supporting equipment.

Soochow Securities released a research report stating that with the explosion of AI computing power, the power supply gap in the U.S. is widening, and power demand is surging, leading CSP manufacturers to build their own power sources, with gas turbines being the first choice, followed by solar storage. Chinese companies are expected to benefit from the high prosperity of U.S. power construction. They particularly recommend the core target of gas turbine complete machines, Dongfang Electric A-shares, and pay attention to Hailianxun (300277.SZ), Harbin Electric, Shanghai Electric A-shares, etc. They also strongly recommend leading solar storage companies such as Sungrow Power Supply (300274.SZ), CATL (300750.SZ), and EVE Energy (300014.SZ). (da/)