Hong Kong Stock Review: Trend Reversal

As the US semiconductor market stabilizes, the pricing for SK Hynix's US IPO is nearing its conclusion. Today's market also saw a reversal, with semiconductors absorbing liquidity from the entire market. Tech stocks experienced widespread losses, with Tencent's decline ending its streak of gains, and Alibaba also opened high but closed low. Even new energy vehicles are expected to decline, as the funding situation and market sentiment cannot support two different trends rising simultaneously.

Whether tech stocks are for short-term profits or just undergoing a correction largely depends on AI sentiment. The key question is whether SK Hynix will list at a lower price and then begin to recover, or continue to deleverage. Considering the previous impact of Meta on market expectations for capital expenditures (capex), it may ultimately take the release of capex guidance for the market to regain confidence, especially given the current overall unstable funding situation.

On the other hand, the concept of domestic substitution is becoming increasingly strong, with news of limited procurement of Nvidia chips and the current domestic large models facing insufficient computing power. These factors are boosting performance and sentiment. For example, recently, KNOWLEDGE ATLAS announced a $4 billion financing plan, which is believed to be used for purchasing domestic chips. Meanwhile, leading storage chip manufacturer Changxin Storage is set to open for subscription, which will directly reflect capital confidence in the domestic semiconductor industry.

Regardless, whether the Hang Seng Index can break free from its current awkward position will depend on whether AI sentiment stabilizes. Only then will old tech stocks have hope; otherwise, Q2 earnings will arrive, and whether in terms of performance or pessimistic scenarios, these reasons are difficult to drive long-term growth