Earnings stocks led the market rally, with the Hang Seng Index posting its largest single-day gain in 10 months, up 681 points. Southbound capital net outflow reached 27.3 billion yuan. A pullback in the broader market presents an opportunity to deploy defensive high-dividend sectors; investors may consider the Fubon SSE/HK High Dividend ETF.

US President Trump announced preliminary progress in US-Iran talks, delaying a planned military strike on Iran’s power plants and energy infrastructure by five days. The news spurred a sharp rise in US stocks overnight, with the Dow Jones Industrial Average surging over 1,000 points at one point. Although Iranian officials denied direct negotiations and emphasized that the war would not end until all sanctions were lifted, Asia-Pacific stock markets generally rebounded. Hong Kong stocks opened more than 350 points higher but dipped later, hitting a low of 24,555 points before gradually recovering in the afternoon. Gains expanded, successfully reclaiming the 25,000-point level, closing near session highs at 25,063 points, up 681 points or 2.79%, marking the largest single-day gain in 10 months with a turnover of 303 billion yuan. The Hang Seng Tech Index closed at 4,830 points, up 118 points or 2.51%. The H-shares Index ended at 8,499 points, gaining 191 points or 2.31%. Among blue chips, 81 stocks rose, while only eight fell and one remained unchanged. However, southbound capital aggressively sold today, with a net outflow exceeding 27.3 billion yuan, marking the second-highest daily net outflow since the launch of Stock Connect, just behind the record 27.7 billion yuan set earlier this month on the 5th.

Earnings reports drove early gains, with several result-announcing stocks leading the market rally. Laopu Gold ($LAOPU GOLD (06181.HK)$ ) reported annual profits and revenue both increasing more than twofold year-on-year, with the final dividend jumping over 88%. Its shares surged 90 yuan or 16.11% during the day, closing at 648.5 yuan, making it the best-performing blue chip of the day. Wuxi Apptec (2359) posted doubled full-year profits, with revenue rising 15%; its shares surged 10.9 yuan or 10.61%, closing at 113.6 yuan. Wuxi XDC ($WUXI XDC (02268.HK)$ ) reported a 38% increase in annual net profit, with its share price rising 5.35 yuan or 10.53%. Fellow subsidiary Wuxi Bio ($WUXI BIO (02269.HK)$ ) also gained 1.48 yuan or 4.57%. Tingyi Holdings ($TINGYI (00322.HK)$ Net profit surged by 20%, with the final dividend and special final dividend totaling 79.84 cents, up approximately 10% year-on-year; share price increased by 1.2 dollars or 9.98%, closing at 13.22 dollars.

The domestic demand and consumption sector generally performed well in the afternoon. Mixue Group ($MIXUE GROUP (02097.HK)$ ) saw a 32.7% increase in net profit last year; its share price rose by 19.2 dollars or 6%, closing at 341.8 dollars; Pop Mart ($POP MART (09992.HK)$ ) will announce its earnings tomorrow. Market anticipation drove the share price up early by 15 dollars or 7.42%, closing at 217.2 dollars; CR Beer ($CHINA RES BEER (00291.HK)$ ) rose by 1.98 dollars or 8.24%, closing at 26 dollars; Haidilao ($HAIDILAO (06862.HK)$ ) rose by 0.82 dollars or 5.41%, closing at 15.99 dollars; Li Ning ($LI NING (02331.HK)$ ) rose by 0.92 dollars or 4.36%, closing at 22 dollars. Macau gambling stocks rebounded simultaneously; Wynn Macau ($WYNN MACAU (01128.HK)$ ) rose by 0.28 dollars or 5.21%; MGM China ($MGM CHINA (02282.HK)$ ) rose by 0.46 dollars or 4.24%; Melco International ($MELCO INT'L DEV (00200.HK)$ ) rose by 0.19 dollars or 5.26%.

ATMXJ generally followed the broader market trend upwards. Alibaba ($BABA-W (09988.HK)$ )’s DAMO Academy released its new flagship processor, Xuantie C950, applicable to cloud computing, generative AI, and high-end robotics, driving the stock price up by 3.5 yuan or 2.92%, closing at 123.2 yuan; Meituan ($MEITUAN-W (03690.HK)$ ) rose by 2.45 yuan or 3.2%, closing at 79 yuan; Tencent ($TENCENT (00700.HK)$ ) increased by 15.6 yuan or 3.13%, closing at 514 yuan; JD.com ($JD-SW (09618.HK)$ ) rose by 2.1 yuan or 2%, closing at 107.2 yuan; Xiaomi ($XIAOMI-W (01810.HK)$ ) announced its earnings today, rising pre-results by 0.62 yuan or 1.93%, closing at 32.68 yuan.

In the AI sector, Zhipu ($KNOWLEDGE ATLAS (02513.HK)$ ) surged by 65 yuan or 11%, closing at 654 yuan; MINIMAX ($MINIMAX-W (00100.HK)$ ) climbed by 113.5 yuan or 12.38%; Changfei Optical Fiber ($YOFC (06869.HK)$ ) rose by 19.1 yuan or 13.09%. In the power equipment sector, Harbin Electric ($HARBIN ELECTRIC (01133.HK)$ ) up by 1.32 yuan or 6%; Dongfang Electric ($DONGFANG ELEC (01072.HK)$ ) up by 2.04 yuan or 5.77%. Auto stocks continue their strong performance following yesterday's impressive showing. Geely ($GEELY AUTO (00175.HK)$ ) rose 0.9 yuan or 4.5%, closing at 20.9 yuan; BYD ($BYD COMPANY (01211.HK)$ ) surged 4.6 yuan or 4.49%, closing at 107 yuan; Li Auto ($LI AUTO-W (02015.HK)$ ) climbed 2.8 yuan or 4.32%, closing at 67.6 yuan; Nio ($NIO-SW (09866.HK)$ ) gained 1.74 yuan or 3.95%; Xpeng ($XPENG-W (09868.HK)$ ) advanced 2.3 yuan or 3.21%.

The financial and insurance sector rebounded in line with the stabilization of global markets, performing well across the board. AIA ($AIA (01299.HK)$ ) rose 5.75 yuan or 7.25%, closing at 85.1 yuan; Standard Chartered ($STANCHART (02888.HK)$ ) increased by 8.8 yuan or 5.65%, closing at 164.5 yuan; HSBC ($HSBC HOLDINGS (00005.HK)$ ) rose by 4.7 yuan or 3.95%, closing at 123.6 yuan; CITIC Bank ($CITIC BANK (00998.HK)$ ) increased by 0.38 yuan or 5.24%; China Taiping ($CHINA TAIPING (00966.HK)$ ) rose by 0.94 yuan or 4.67%; Ping An ($PING AN (02318.HK)$ ) gained 2 yuan or 3.48%; China Life (2628) climbed 0.88 yuan or 3.38%. Interest-rate sensitive local property stocks also rebounded, Sun Hung Kai Properties ($SHK PPT (00016.HK)$ ) advanced 4.9 yuan or 3.88%; Swire Properties ($SWIREPROPERTIES (01972.HK)$ ) rose 1.02 yuan or 4.38%; Henderson Land ($HENDERSON LAND (00012.HK)$ ) despite announcing a 38% drop in full-year underlying profit and cutting the final dividend to 76 cents, its share price still rose 0.68 yuan or 2.27% with the broader market.

Gold stocks surged across the board today, with Laopu Gold’s earnings also boosting sector sentiment; Zijin Mining ($ZIJIN MINING (02899.HK)$ ) soared 2.34 yuan or 7.2%; Zhaojin Mining (1818) jumped 2.02 yuan or 7.5%; China Gold International ($CHINAGOLDINTL (02099.HK)$ ) surged 11.4 yuan or 8.19%; Lingbao Gold ($LINGBAO GOLD (03330.HK)$ ) rose by 2.14 yuan or nearly 10%; Shandong Gold ($SD GOLD (01787.HK)$ ) rose by 1.24 yuan or 4.14%; Zijin Gold International ($ZIJIN GOLD INTL (02259.HK)$ ) rose by 10.2 yuan or 6%. In the resources sector, China Hongqiao ($CHINAHONGQIAO (01378.HK)$ ) saw confidence boosted by yesterday's share repurchase news, rebounding today by 2.34 yuan or 7.38%, closing at 34.04 yuan; Luoyang Molybdenum ($CMOC (03993.HK)$ ) rose by 1.07 yuan or 6.64%; Minmetals Resources ($MMG (01208.HK)$ ) rose by 0.53 yuan or 7.44%.

CATL ($CATL (03750.HK)$ ) experienced profit-taking after rising for several consecutive days, falling by 17 yuan or 2.57%, closing at 645 yuan, making it one of the blue chips with larger declines; Sinopharm ($SINOPHARM (01099.HK)$ ) fell by 0.74 yuan or 3.62%, closing at 19.68 yuan, becoming the worst-performing blue chip of the day.

News of easing tensions in the Middle East caused oil prices to fall back; CNOOC (0$CNOOC (00883.HK)$ ) fell against the market trend today by 1.06 yuan or 3.48%, closing at 29.44 yuan; PetroChina ($PETROCHINA (00857.HK)$ ) dropped by 0.04 yuan or 0.37%, closing at 10.72 yuan. The decline in oil prices benefited airline stocks, with China Southern Airlines (1055) rising by 0.17 yuan or 4.32%; Air China ($AIR CHINA (00753.HK)$ ) increased by 0.2 yuan or 4.32%; China Eastern Airlines ($CHINA EAST AIR (00670.HK)$ ) rose by 0.25 yuan or 7.27%; in the energy shipping sector, COSCO Shipping Energy ($COSCO SHIP ENGY (01138.HK)$ ) surged by 1.54 yuan or 7.82%.

In terms of new stocks, today’s debut of two new listings showed starkly different performances. Galaxis ($GALAXIS TECH (02729.HK)$ ) closed at 30.7 yuan, an 84.3% increase from its IPO price of 16.66 yuan; Zhejing Pharmaceutical ($NEW VISION CO (02632.HK)$ ), despite opening higher, quickly reversed and closed at 27.88 yuan, a 36.9% drop from its IPO price of 44.2 yuan.

The external environment remains volatile, with ongoing geopolitical conflicts in the Middle East repeatedly unsettling market sentiment. Yesterday's 'Black Monday' saw the Hang Seng Index plunge over a thousand points, briefly losing the 25,000 mark, reflecting continued market instability largely driven by news flow. Although the market rebounded today, southbound capital outflows reached a record second-highest level of 27.3 billion yuan, indicating that some investors are pulling out of high-risk assets. Given the persistent external uncertainties and as the broader market begins to correct from its highs, now is an opportune time to deploy defensive and high-dividend sectors to hedge against geopolitical risks and global volatility. Fubon CSI-Hang Seng High Dividend ETF ($Fubon Hang Seng Shanghai-Shenzhen-Hong Kong (Selected Corporations) High Dividend Yield Index ETF (03190.HK)$ ) primarily tracks the Hang Seng CSI-Hang Seng (Selected Enterprises) High Dividend Yield Index, covering defensive industries such as energy, finance, building materials, and industrials. Its constituent stocks include COSCO Shipping Holdings ($COSCO SHIP HOLD (01919.HK)$ ), and China Hongqiao ($CHINAHONGQIAO (01378.HK)$ ) and CNOOC ($CNOOC (00883.HK)$ ) and other large enterprises, the ETF closed at 17.54 yuan today, up 0.24 yuan or 1.39%. In addition, the Fubon SSE-SZSE-HK High Dividend ETF aims to distribute dividends quarterly, making it suitable for long-term investors seeking stable cash flow amidst market volatility and who prefer high-yield defensive allocations.

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