Hong Kong Stock Market Closing (08.22) | Hang Seng Index rose by 0.93% DeepSeek's new model ignites chip stocks SMIC surged by 10% leading blue chips

According to Zhitong Finance APP, the market is focused on Federal Reserve Chairman Jerome Powell's speech at the global central bank annual meeting. In addition, the technology stock market has driven the Hong Kong stock market up, with the Hang Seng Technology Index soaring nearly 3% today. By the close, the Hang Seng Index rose 0.93% or 234.53 points, closing at 25,339.14 points, with a total turnover of HKD 285.584 billion; the Hang Seng China Enterprises Index rose 1.17%, closing at 9,079.93 points; the Hang Seng Technology Index rose 2.71%, closing at 5,647.68 points. For the week, the Hang Seng Index accumulated a rise of 0.27%, the China Enterprises Index accumulated a rise of 0.45%, and the Technology Index accumulated a rise of 1.89%.

CITIC Securities pointed out that looking ahead, they remain optimistic about the Hong Kong stock market. As of the current data, the interim profits of Hong Kong stocks are improving, with the performance forecast rate reaching a three-year high. The profits of Hong Kong stocks with a higher "new economy" content may continue to improve ahead of A-shares. In previous bull markets, the Hong Kong stock index slightly lagged behind A-shares, so in this round of allocation, it is recommended to focus on differentiated directions from A-shares. In terms of rhythm, it is suggested to first focus on innovative drugs (liquidity easing + BD data continuing to improve), then on the internet (the turning point of the takeaway war appears), and finally on new consumption (the turning point of the macro economy and profits appears).

Blue Chip Performance

SMIC (00981) led the blue chips. By the close, it rose 10.06%, closing at HKD 56.9, with a turnover of HKD 16.409 billion, contributing 36.87 points to the Hang Seng Index. DeepSeek officially released the DeepSeek-V3.1 large model on August 21, using UE8M0 FP8 Scale parameter precision for the next generation of domestic chip design. Caixin Securities believes this move is expected to promote the process of domestic computing power autonomy. Zheshang Securities stated that the explosive demand for domestic AI chips and the trend of localization of edge-side chips are expected to drive SMIC's performance growth beyond expectations.

In other blue chip stocks, Li Ning (02331) rose 8.78%, closing at HKD 19.7, contributing 5.73 points to the Hang Seng Index; BYD Electronics (00285) rose 6.13%, closing at HKD 39.5, contributing 2.77 points to the Hang Seng Index; Sinopec (00386) fell 1.78%, closing at HKD 4.41, dragging down the Hang Seng Index by 3.04 points; China Resources Power (00836) fell 1.57%, closing at HKD 18.22, dragging down the Hang Seng Index by 0.94 points.

Popular Sectors

On the market, large technology stocks collectively rose, with Kuaishou rising over 4% after earnings, Alibaba rising nearly 2%, and Tencent rising over 1%. The new version of DeepSeek ignited chip stocks, with Hua Hong Semiconductor soaring 17% and SMIC rising 10%; most automotive stocks performed well, with He Xiaopeng investing about HKD 250 million to increase his stake, XPeng rising 13%, and Nio's new ES8 officially starting pre-sales, with its stock price rising 11%; active market trading benefited brokerages, with Everbright Securities rising over 7% in the afternoon; Apple concept stocks, robotics concept stocks, and others rose. On the other hand, airline stocks fell sharply; infrastructure, photovoltaic, and coal stocks weakened.

1. Chip stocks collectively exploded. By the close, Hua Hong Semiconductor (01347) rose 17.85%, closing at HKD 56; ZTE Corporation (00763) rose 15.13%, closing at HKD 36.06; SMIC (00981) rose 10.06%, closing at HKD 56.9; Fudan Shanghai (01385) rose 6.36%, closing at HKD 31.76.

On August 21, DeepSeek released DeepSeek-V3.1. It was introduced that compared to DeepSeek-R1-0528, DeepSeek-V3.1-Think can provide answers in a shorter time. The new model shows significant improvement in tool usage and agent tasks. Notably, DeepSeek stated that DeepSeek-V3.1 uses UE8M0 FP8 Scale parameter precision, and the new precision format is designed for the upcoming next-generation domestic chips. Additionally, reports indicate that American tech giant NVIDIA has ordered a halt to the production of H20 chips, which has once again made domestic alternatives a market focus.

CITIC Construction Investment pointed out that the domestic computing power sector is experiencing intensive catalysts. Tencent's earnings call indicated that there are multiple supply channel options for inference chips, and under the backdrop of international supply chain fluctuations, domestic inference computing power chips are expected to provide support. DeepSeek's model update clearly supports FP8 precision and the upcoming next-generation domestic chips, and the leading domestic open-source models' support for domestic chips is expected to accelerate the landing of the domestic computing power ecosystem. Huawei's Ascend chips have recently participated in government, finance, and telecom industry client bidding products, confirming the continuous improvement of domestic chip competitiveness.

2. Airline stocks fell sharply. As of the close, China National Airlines (00753) fell 5.13%, closing at HKD 5.18; China Eastern Airlines (00670) fell 2.83%, closing at HKD 3.09; China Southern Airlines (01055) fell 1.77%, closing at HKD 3.89; Capital Airport (00694) fell 0.32%, closing at HKD 3.07.

Listed airlines released July operational data. Dongxing Securities pointed out that in July, the capacity deployment of listed companies on domestic routes increased by 2.3% year-on-year and approximately 20.5% month-on-month compared to June. The industry has entered the peak season, and the month-on-month increase in capacity deployment is quite significant, but considering the year-on-year perspective, the growth rate is not very high. In terms of passenger load factor, the overall passenger load factor of listed companies in July increased by about 0.6 percentage points compared to the same period last year, but decreased by 1.0 percentage points compared to June. Since the beginning of this year, airlines' passenger load factors have generally been higher than the same period last year, but the increase in passenger load factor during the peak season in July narrowed to 0.6 percentage points, coupled with a month-on-month decline in peak season passenger load factor, indicating that the demand side during this year's peak season may be weaker than airlines' expectations. The performance of airlines' passenger load factors in July indicates that the industry's demand side remains difficult to be optimistic.

3. The mid-year report market continues, and the market is again favoring high-performing stocks. As of the close, Miniso (09896) rose 20.58%, closing at HKD 47.1; SUTENG (02498) rose 13.1%, closing at HKD 39.02; Li Ning (02331) rose 8.78%, closing at HKD 19.7; Kuaishou-W (01024) rose 4.39%, closing at HKD 74.9.

Miniso achieved revenue of 4.97 billion yuan in the second quarter, a year-on-year increase of 23.1%, with adjusted net profit increasing by 10.6% year-on-year to 690 million yuan, among which TOP TOY's revenue surged by 87.0%, setting a new record for the second quarter; SUTENG achieved revenue of approximately 460 million yuan in the second quarter, a year-on-year increase of 24.4% and a month-on-month increase of 38.9% Among them, the robotics business showed explosive growth, with product sales reaching 34,400 units, a year-on-year increase of 631.9%; Li Ning's revenue in the first half of this year rose 3.3% year-on-year to 14.817 billion yuan, with a gross profit of approximately 7.415 billion yuan, a year-on-year increase of 2.48%; net profit was approximately 1.737 billion yuan; Kuaishou's revenue in the second quarter increased by 13.1% year-on-year to 35 billion yuan, with adjusted net profit increasing by 20.1% year-on-year to 5.6 billion yuan. Both gross margin and adjusted net profit margin broke historical peaks, reaching 55.7% and 16.0%, respectively.

Popular Volatile Stocks

1. XPeng-W (09868) remained strong throughout the day, closing up 13.6% at HKD 91.9.

XPeng announced that from August 20 to 21, the company's co-founder, executive director, chairman, CEO, and controlling shareholder He Xiaopeng purchased 3.1 million Class A ordinary shares in the open market through his wholly-owned Galaxy Dynasty Limited, at an average price of HKD 80.49 per share, with a total expenditure of approximately HKD 250 million. After this increase, He Xiaopeng and his associates collectively own about 18.9% of the company. This is the first time in a year that He Xiaopeng has increased his stake in the company.

2. Nio-SW (09866) continued to rise, closing up 11.12% at HKD 45.76.

On the evening of August 21, Nio held a technical launch event for its new ES8 product in Chengdu. Nio Chairman Li Bin announced the pre-sale price of the new ES8 on-site, with a starting pre-sale price of 416,800 yuan for the whole vehicle and 308,800 yuan for the battery rental option. The new ES8 is expected to be launched and delivered in late September 2025. Nio President Qin Lihong revealed, "Nio does not disclose the number of orders, but if calculated by the hour, the order volume for the new ES8 has exceeded that of last month's Lido L90 so far."

3. COSCO Shipping Energy (01138) performed brilliantly, closing up 7.63% at HKD 7.19.

Recently, the U.S. President issued an executive order imposing an additional 25% tariff on India for its continued purchase of Russian oil, raising India's total import tariff to 50%. Shenwan Hongyuan previously pointed out that U.S. sanctions on Iran have escalated, leading to a continuous low operation of Iranian crude oil exports for three weeks; U.S. pressure on India to reduce Russian oil purchases has caused a decline in Russian crude oil exports to India. These two changes have increased compliant crude oil demand, and the demand for VLCC to replace medium and small vessels has further supported the market.

4. IFBH (06603) plummeted after earnings, closing down 14.08% at HKD 34.54. IFBH released its mid-term results for 2025, with the group achieving revenue of USD 94.464 million, an increase of 31.49% year-on-year; profit attributable to the owners of the parent company was USD 14.976 million, a decrease of 4.82% year-on-year; adjusted net profit was USD 18.9 million, an increase of 13.9% year-on-year. The gross profit margin for the six months ended June 30, 2025, was 33.7%, a decrease of 4.7 percentage points compared to 38.4% in the same period of 2024