Market Overview
▪ HK stocks closed with all three major indices falling;
▪ The Hang Seng Index closed at 26,347.910 points, down 0.22%;
▪ The SOE Index closed at 8,882.370 points, down 0.02%;
▪ The Hang Seng Tech Index closed at 5,070.610 points, down 0.70%.
Sector Performance and Hot Stocks
Memory Chip Sector Plunges as AI Cost Concerns Intensify
▪ CSOP SK Hynix (07709.HK) fell 6.27% to HK$90.92; CSOP Samsung (07747.HK) fell 5.00%;
▪ Hua Hong Semiconductor (01347.HK) fell 3.36%, Shenghong Technology (02476.HK) fell 4.58%, and Cambridge Industries Group (06166.HK) fell 3.71%;
▪ Institutional analysis pointed out that the proportion of memory costs in AI capital expenditure is set to soar to 30% by 2026. This heavy &#34;memory tax&#34; may prompt tech giants to accelerate self-developed chips, sparking debate in the market about overvaluation in the memory sector.
Hengrui Medicine Leads Pharma Sector, Record-Breaking Overseas BD Deal
▪ Hengrui Medicine (01276.HK) rose 4.92% to HK$69.3, with turnover reaching HK$1.34 billion;
▪ The company signed a global strategic cooperation agreement with BMS with a potential total value of up to $15.2 billion, covering 13 early-stage projects, marking one of the largest overseas BD transactions for domestic innovative drugs.
Resource and Energy Stocks Active Against the Trend, Geopolitical Situation Supports Oil Prices
▪ PETROCHINA (00857.HK) rose 3.85% to HK$11.05;
▪ Zijin Mining (02899.HK) rose 1.69%, CNOOC (00883.HK) rose 1.28%, and CMOC Group (03993.HK) rose nearly 2%;
▪ Trump's rejection of Iran's ceasefire proposal has heightened tensions in the Middle East again. Decreased traffic through the Strait of Hormuz has pushed international oil prices back towards the $100 mark.
Divergence in Tech Heavyweights, Small-Cap Stocks Surge on High Volume
▪ Kuaishou-W (01024.HK) rose 2.13%, NetEase-S (09999.HK) rose 2.14%, and Meituan-W (03690.HK) edged up 0.06%;
▪ Tencent Holdings (00700.HK) fell 1.34% to HK$458.2; Alibaba-W (09988.HK) edged down 0.22%, and Baidu Group-SW (09888.HK) fell 1.06%;
▪ Nobikan (02635.HK) surged 17.85% in a single day; Deepexi (01384.HK) rose 13.34%, hitting a high of HK$77.65 during the session.
Macro Background
▪ AI Cost Pressure: The proportion of memory chip costs in AI computing infrastructure is rising rapidly, causing tech giants to worry about high &#34;memory taxes.&#34; The market is currently re-evaluating the earnings certainty and valuation bubbles in the memory industry.
▪ Middle East Geopolitics: Trump's hardline stance on Iran has brought the peace process to the brink of collapse, increasing risks along global crude oil shipping routes and providing clear risk premium support for the oil, gas, and resources sectors.
Top 10 Market Turnover
▪ Tencent Holdings: Latest price HK$458.20, down 1.34%, turnover HK$13.4 billion
▪ Kuaishou-W: Latest price HK$52.70, up 2.13%, turnover HK$8.06 billion
▪ SMIC: Latest price HK$77.15, up 0.72%, turnover HK$7.42 billion
▪ Alibaba-W: Latest price HK$133.60, down 0.22%, turnover HK$6.76 billion
▪ Hang Seng China Enterprises: Latest price HK$91.22, up 0.15%, turnover HK$4.95 billion
▪ Yangtze Optical Fibre and Cable: Latest price HK$272.00, up 4.86%, turnover HK$4.21 billion
▪ Hua Hong Semiconductor: Latest price HK$129.50, down 3.36%, turnover HK$4.09 billion
▪ CSOP SK Hynix: Latest price HK$90.92, down 6.27%, turnover HK$8.43 billion
▪ Xiaomi Group-W: Latest price HK$31.54, down 0.50%, turnover HK$2.7 billion
▪ Deepexi: Latest price HK$70.95, up 13.34%, turnover HK$2.56 billion

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On May 12, the Hong Kong stock market fluctuated lower, with all three major indices closing in the red. The Hang Seng Tech Index fell by 0.70%. Affected by concerns over AI infrastructure costs and a "memory tax," the memory chip sector plunged collectively, with related ETFs dropping more than 6%. In contrast, Hengrui Medicine, catalyzed by a blockbuster $15.2 billion BD agreement, and oil and gas resource stocks, supported by risk-aversion sentiment, performed actively. Trends among tech heavyweight stocks diverged; Tencent topped the turnover list but saw its share price decline

Market Pulse

PETROCHINA

GTJA Allianz CSI All Share Semiconductors & Semiconductor Equipment ETF

GTJA Allianz SSE STAR Chip Design Thematic ETF

ChinaAMC Guozheng Semiconductor Chip ETF

Guotai CSI Oil & Gas Industry ETF

Guotai CSI Semiconductor Material Equipment Theme ETF

E Fund CSI Semiconductor Material & Equipment Thematic ETF

E Fund CSI Petrochemical Industry ETF

Bosera CSI Oil & Gas Resources Index ETF

Harvest SSE STAR Chip ETF

Guotai CES Semiconductor Chip Industry ETF

China Universal CSI Oil & Gas Resources ETF

Guotai CSI All Share Integrated Circuit ETF

Harvest CSI All Share Integrated Circuit ETF

Yinhua CSI Oil & Gas Resources ETF

China Merchants CSI Semiconductor Industry ETF

ChinaAMC CSI Petrochemical Industry ETF

Hang Seng Index

Hang Seng China Enterprises Index

Hang Seng TECH Index

TENCENT

KUAISHOU-W

NTES-S

XL2CSOPHYNIX

XL2CSOPSMSN

SMIC

HUA HONG SEMI

ZIJIN MINING

Zijin Mining

HENGRUI PHARMA

Hengrui Pharma

Bristol Myers Squibb

CNOOC

CMOC

MEITUAN

BABA-W

Alibaba

BIDU-SW

Baidu

BANK OF CHINA

Bank Of China

YOFC

CHINA RES LAND

NUOBIKAN

DEEPEXI TECH

XIAOMI-W

MONTAGE TECH

HSCEI ETF

Tencent

TENCENT-R

Tencent HK SDR 10to1

Tencent Holdings Limited

KUAISHOU-WR

NetEase

SMIC HK SDR 5to1

Hua Hong

PetroCN HK SDR 1to2

Bristol-Myers Squibb Company

CNOOC-R

MEITUAN-WR

Meituan

Meituan HK SDR 5to1

BABA-WR

Alibaba HK SDR 5to1

BIDU-SWR

BOC HONG KONG

Bank of China

AIA-R

AIA Group

Xiaomi Corporation

XIAOMI-WR

Xiaomi HK SDR 2to1

Montage Technology

HK Stocks Close | All Three Major Indices Fall, Resources and Pharma Stocks Buck the Trend, Memory Chip Sector Plunges