Zhitong Hong Kong Stock Analysis | The Federal Reserve's rate cut in September remains unclear, overseas reflects AI application sector rising again

[Market Dissection]

The end of the month is a sensitive time prone to market fluctuations. This time, due to a disappointing major meeting and external pressures, both markets failed to hold up, with the Hang Seng Index gapping down by 1.6%.

On July 30th, Eastern Time, the Federal Reserve maintained its stance as expected by the market. Among the FOMC voting members, Powell and nine others continued to support holding steady, while Waller and Bowman advocated for a 25 basis point rate cut this time. However, Powell did not provide clear guidance on a rate cut in September during the press conference, emphasizing inflation risks and stating that employment is stable, which dampened expectations for a rate cut this year. The dollar rose for five consecutive days, reaching a two-month high, surging over 1.1%, approaching the critical level of 100. It seems that Trump's threats to Powell were ineffective, as the deeper government firmly controls the Federal Reserve. Now, with no expectations for September, U.S. stocks took a direct plunge.

The deadline for "reciprocal tariffs" on August 1st is approaching, and the U.S. has rapidly reached agreements with some of its trade partners in recent days, including the European Union and Japan. Last night, the U.S. announced that it had reached a trade agreement with South Korea, imposing a 15% tariff on South Korean imports, while South Korea promised to invest $350 billion in the U.S. and purchase $100 billion worth of U.S. energy products. It seems that investment and purchasing are standard requirements. When discussing South Korea's $350 billion investment plan, Lutnik stated that 90% of the profits would belong to the U.S. This is hardly different from outright theft. Higher tariff rates will be imposed on several countries that fail to reach trade agreements before the August 1st deadline, such as a 25% tariff on goods exported from India to the U.S. and other "punishments"; a 40% tariff on Brazil, bringing the total tariff to 50%. Many might find the high tariff on India strange, but the logic is simple: India is the largest buyer of Russian energy, and more critically, after losing the India-Pakistan conflict, India has lost its value. The U.S. then cozies up to Pakistan: "We just signed a petroleum agreement with Pakistan, and we might sell oil to India in the future!" Other countries that have not signed, such as the U.S.'s important allies Canada and Mexico, have sent delegations to engage in tense closed-door talks with U.S. officials. Despite negotiations lasting all night, the outlook remains unclear.

The White House also announced a 50% general tariff on imported semi-finished copper products and copper-intensive derivatives, causing significant turmoil in global markets once again. U.S. Comex copper futures prices plummeted, marking the largest single-day drop in history. Related metals and precious metals were also impacted, with Lao Pu Gold (06181) dropping over 8%, Zijin Mining (02899) and Luoyang Molybdenum (03993) falling over 5%.

However, Trump has not expressed his stance on tariffs against China. It is highly likely that there will be a 90-day extension. Looking at the world, we are the only ones daring to stand up to the U.S. However, various provocations continue, such as media reports that a U.S. congressional delegation will visit Taiwan in August, to which the Ministry of Foreign Affairs expressed strong opposition. Any slight disturbance can lead to adjustments in innovative drugs.

Yesterday, we discussed the major meeting, which did not mention real estate. Some interpreted this as a sign that the higher-ups believe the overall risks are manageable at present, or that their tolerance for risk is increasing. The overall weakness of the industry aligns with the development rules of the new phase, indicating that excessive human intervention is unnecessary Is this not the original intention? Anyway, real estate is lying on the decline list today.

Real estate also had a supplementary blow today: On July 31, the General Office of the People's Government of Beijing Municipality issued the "Measures for Improving the Fertility Support Policy System and Promoting the Construction of a Fertility-Friendly Society," which mentioned increasing support for home purchases by families with multiple children and introducing policies to appropriately raise housing provident fund loan limits based on actual conditions. But it does not solve the fundamental problem.

The measures mentioned: Including suitable delivery analgesia and assisted reproductive technology projects into the scope of medical insurance payment, and timely adjusting relevant medical insurance payment policies. Jinxin Reproductive (01951) surged briefly during the day but had no further developments. It's difficult to raise the birth rate, and the logic for infant and child-related products is also not smooth.

CATL (03750) achieved a net profit attributable to the parent company of 30.512 billion RMB in the first half of the year, a year-on-year increase of 33.02%. This performance is quite good, but it has been falling hard these past two days. There are rumors that Tesla signed a $4.3 billion battery agreement with LGES to reduce dependence on China; and another domestic company has made progress.

The market is once again speculating on the reflection of U.S. stocks, with NVIDIA continuing to surge to new highs, driving further increases in computing hardware, and reinforcing the logic of underlying optical fibers. Changfei Optical Fiber (06869), mentioned the day before, rose over 7% again, as it recently won a project from China Mobile. Although the amount is not large, it shows the company's core competitiveness in the hollow fiber field, and the overseas market is expected to open up incremental space. AsiaInfo Technologies (01675) rose over 6% today due to the deep integration of its digital twin platform with NVIDIA's Omniverse.

However, it should be noted that after-hours negative news emerged, revealing serious security issues with NVIDIA's computing chips. U.S. lawmakers have called for exported chips to be equipped with "tracking and positioning" functions; the National Internet Information Office interviewed NVIDIA on July 31, 2025, requiring it to explain the security risks of the H20 computing chip vulnerabilities and submit relevant proof materials. This theoretically benefits domestic alternative chip manufacturers, such as SMIC (00981) and Hua Hong Semiconductor (01347).

In addition to NVIDIA, META and Microsoft also saw significant gains. META's growth was mainly driven by AI intelligent recommendation algorithms boosting advertising revenue; while Microsoft's growth was primarily due to a substantial increase in cloud computing business. The benchmark variety Kingdee International (00268) surged over 9%; other companies such as Kingsoft Cloud (03896), Meitu (01357), and Fourth Paradigm (06682) all rose over 4%.

On July 30, OpenAI launched ChatGPT's "Learning Mode," which is mainly aimed at the education sector. The core feature is the breakdown interpretation of difficult problems, clearly presenting problem-solving ideas and complete processes, rather than simply outputting answers. Currently, ChatGPT's "Learning Mode" has been opened to free, Plus, Pro, and Team users, and will soon be launched in ChatGPT Edu within a few weeks. The AI application sector was stimulated, with AI + education Chalk (02469) rising over 5%; AI + AGENT Meitu (01357) surged over 11%; Kuaishou (01024) introduced a new feature "Ling Animation Canvas" supporting collaboration of up to 5 people, upgrading the multi-image reference function, and rose over 6% today The National Healthcare Security Administration has announced that the 30 batches of project guidelines include over 100 new price items related to new products and new equipment. Among them, the guidelines for the nervous system category have uniformly established price items such as "brain-computer interface implantation fee" and "brain-computer interface adaptation fee." Once the brain-computer interface technology matures and is approved for clinical use, it can quickly enter clinical applications and charge fees. If it enters the charging phase, the valuation will significantly increase. Nanjing Panda Electronics Co., Ltd. (00553) rose over 5%, while other varieties include Microinvasive Brain Science (02172).

[Sector Focus]

On July 31, Zhang Yijun, the first vice chairman of the China Audio-Video and Digital Publishing Association, released the "2025 China Game Industry Report for January to June." The report shows that in the first half of 2025, the actual sales revenue of the domestic game market reached 168 billion yuan, a year-on-year increase of 14.08%, setting a historical record. At the same time, the domestic game user base reached 679 million, also a historical high.

Main varieties: Tencent (00700), NetEase (09999), Xindong Company (02400), Bilibili-W (09626), Zhongxu Future (09890).

[Stock Picking]

Weimob Group (02013): JP Morgan increases its stake to 5.33%, focusing on its core competitiveness

Latest data from the Hong Kong Stock Exchange shows that on July 24, JP Morgan increased its stake in Weimob Group (02013) by 18,685,235 shares at a price of HKD 2.0488 per share, totaling approximately HKD 38.2823 million. After the increase, the latest number of shares held is approximately 193 million, with a holding ratio of 5.33%.

Commentary: The reason JP Morgan continues to increase its stake is mainly due to its core competitiveness, such as being a core service provider for Tencent's advertising, leveraging Tencent's resources to provide massive exposure, and achieving a one-stop service from advertising to operations, completing the full chain from content seeding to transaction conversion. It has served over 4 million clients, gaining high recognition and a good reputation in the industry, and has won multiple awards. It has built the WOS new business operating system and Weimob Cloud PaaS platform, which can create decentralized business infrastructure. From the product perspective, the company has launched a three-in-one core capability of "public domain integration × private domain growth × operational efficiency," covering data integration, multi-platform scenario construction, industry deepening, AI efficiency enhancement, etc. It offers intelligent solutions such as Weimob WAI, WAIPro, and WIME, with AI capabilities spanning the entire process of marketing, operations, and user management. Its main focus is clear, providing refined services and vertical industry solutions for various industries such as retail, apparel, pets, fast-moving consumer goods, automotive, and finance. For example, it strengthens the digital capabilities of sales assistants for apparel companies and provides public domain content production and operation tools for pet brands. With the booming AI applications in the US stock market, the Chinese market is also expected to bring good prospects