The Hang Seng Index rose 310 points to reclaim the 26,000 level. Alibaba and Pop Mart faced pressure following their earnings releases. With Korean stocks showing renewed strength, investors looking to participate while maintaining stable cash flow may consider the CSOP Korea Covered Call ETF.

Rising US long-term bond yields and oil prices initially weighed on external markets, but Hong Kong stocks opened higher on Friday and gradually extended gains. The Hang Seng Index closed near its daily high, reclaiming the 26,000 mark and the 250-day moving average. It ended the day at 26,009, up 310 points or 1.21%, with main board turnover reaching HK$257.2 billion. The Hang Seng China Enterprises Index closed at 8,634, up 86 points or 1.01%. The Hang Seng Tech Index closed at 4,766, up 65 points or 1.4%. Southbound capital recorded a net outflow of HK$7.63 billion, marking the third consecutive day of outflows.

Ping An ($PING AN (02318.HK)$ ) rose 3.88% after announcing its earnings, closing at HK$56.2. Management stated that the 20% individual income tax on overseas policy returns is not a new policy. The group's overseas policy business accounts for a very small proportion, with almost zero impact on the overall results. The group's new business value grew by 11% in the first half of the year, and it believes that life insurance products offering long-term stable guaranteed returns are still in a golden development period despite the low-interest-rate environment. The insurance sector performed well in tandem: China Life ($CHINA LIFE (02628.HK)$ ) rose 5.09%, closing at HK$28.06; PICC Property and Casualty Company ($PICC P&C (02328.HK)$ ) rose 3.61%, closing at HK$16.09; AIA ($AIA (01299.HK)$ ) rose 3.3%, closing at HK$75.15.

Alibaba ($BABA-W (09988.HK)$ ) reported adjusted net profit for the first fiscal quarter below expectations. The stock opened higher but closed lower, ending at HK$123, down 2.54%. The market remains focused on the company's heavy investment phase in AI infrastructure, the Qwen model, and instant retail, which puts short-term profitability under pressure. However, several major banks maintained positive ratings, believing that revenue growth, pricing power, and improved utilization in the cloud business are expected to deliver investment returns in the long run.

Tech and internet stocks showed mixed performance: Xiaomi ($XIAOMI-W (01810.HK)$ ) rose 4.54%, closing at HK$29.02; Tencent ($TENCENT (00700.HK)$ ) rose 1.24%, closing at HK$457; NetEase ($NTES (09999.HK)$ Driven by strong gaming business performance and record-high gross margins, NetEase ( ) rose 4.45% to close at HKD 202. Goldman Sachs noted that NetEase's Q2 gaming revenue increased 10% year-on-year, with operating profit up 29%. The bank believes that declining channel costs and a higher proportion of self-owned channels will support structural gross margin expansion; Meituan ($MEITUAN-W (03690.HK)$ ) fell 0.99% to close at HKD 85.

Pop Mart ($POP MART (09992.HK)$ ) saw its interim net profit rise only 10.1% year-on-year to RMB 5.038 billion, while revenue grew 23.8% to RMB 17.173 billion, both missing market expectations. Overseas revenue declined for the first time, and management acknowledged that the full-year revenue growth target of no less than 20% is unlikely to be met. Although the company plans to repurchase RMB 2–5 billion worth of shares over the next six months, this failed to alleviate market concerns about slowing Labubu sales and deleveraging in overseas markets. The stock closed at HKD 149, down 3.06%.

Performance among other earnings reporters was mixed. J&T Express ($J&T EXPRESS-W (01519.HK)$ ) nearly doubled its interim profit, closing at HKD 10.42, up 3.79%; Master Kong ($TINGYI (00322.HK)$ ) rose 2.21% to close at HKD 13.88, hitting a new high; Henderson Land ($HENDERSON LAND (00012.HK)$ ) saw its half-year underlying profit increase more than 66% year-on-year, beating market expectations, with the stock rising 7.17% to close at HKD 30.2; CK Asset Holdings ($CK ASSET (01113.HK)$ ) rose 3.62% to close at HKD 48.1; CITIC Limited ($CITIC (00267.HK)$ ) rose 6.2% to close at HKD 13.19; China Telecom ($CHINA TELECOM (00728.HK)$ ) Q2 net profit beat expectations, drawing bullish views from Citi and UBS Group. It closed at HK$4.885, up 3.28%.

Resource stocks followed the strength in gold and metal prices, with spot gold stabilizing at US$4,500 per ounce. Zijin Gold International ($ZIJIN GOLD INTL (02259.HK)$ ) rose 8.09% to close at HK$160.3; Zijin Mining ($ZIJIN MINING (02899.HK)$ ) gained 4.9% to close at HK$38.56; Lingbao Gold ($LINGBAO GOLD (03330.HK)$ ) climbed 7.88% to close at HK$25.2. In the retail gold sector, Laopu Gold ($LAOPU GOLD (06181.HK)$ ) rose 7.46% to close at HK$397.8, making it the best-performing blue-chip stock today; Chow Tai Fook ($CHOW TAI FOOK (01929.HK)$ ) edged up 1.12% to close at HK$13.54. Rising aluminum prices also drove Aluminum Corporation of China ($CHALCO (02600.HK)$ ) up 3.96% to close at HK$8.4; China Hongqiao ($CHINAHONGQIAO (01378.HK)$ ) advanced 3.48% to close at HK$23.18.

AI large model stocks were sought after in the afternoon session, as the market focused on Zhipu AI's earlier participation in the financing of Yuanli Lingji, an embodied AI company. The Hang Seng Index Company's quarterly review results will be announced after the market close on Friday. MiniMax and Zhipu AI are both potential candidates for inclusion as blue chips. If these two stocks are added to the Hang Seng Index, the potential allocation demand from related index funds will become a key focus going forward. MiniMax ($MINIMAX-W (00100.HK)$ ) rose 11.86% to close at HK$347.2; Zhipu ($Z.AI (02513.HK)$ ) rose 10.36% to close at HK$1,129; Xunce ($XUNCE (03317.HK)$ ) rose 2.09% to close at HK$137.1.

Bitcoin surged past US$77,000, driving related ETFs and concept stocks in Hong Kong higher. Boyaa Interactive ($BOYAA (00434.HK)$ ) jumped 23.79%. Shipping stocks also remained strong, with OOIL ($OOIL (00316.HK)$ ) rising 4.56% to close at HK$176.7, hitting a record high; TS Lines ($TS LINES (02510.HK)$ ) gained 6.4% to close at HK$11.97; SITC International ($SITC (01308.HK)$ ) rose 5.42% to close at HK$49.06, also setting a new high.

The Hang Seng Index reclaimed the 26,000-point mark on Friday, lifted by financial, resource, and AI concept stocks. The CSOP KOSPI 200 Covered Call Active ETF ($CSOP KOSPI 200 Covered Call Active ETF (03537.HK)$ ) also benefited from the positive sentiment in Korean tech and semiconductor sectors, closing at HK$9.85, up HK$0.175 or 1.81%. The fund announced its first monthly distribution since listing, paying HK$0.29 per unit. The ex-date is August 31, implying a target annualized distribution yield of 36% based on the net asset value as of August 13.

3537 does not directly purchase all constituent stocks of the KOSPI 200. Instead, it gains exposure to the South Korean large-cap market primarily through KOSPI 200 futures using a synthetic representative sampling approach, while actively selling KOSPI 200 index call options to collect option premiums. Samsung Electronics, SK Hynix, Hyundai Motor, and financial firms constitute the major weightings in the Korean equity market. The fund's net asset value is expected to benefit from rising AI capital expenditure, memory prices, and semiconductor demand. However, if Korean stocks surge, the upside potential of this covered call strategy will be capped by the sold call options. The management fee for 3537 is 0.99% per annum, with a lot size of 100 units. The fund manager has the discretion to decide on distributions and the distribution amount based on market conditions, option premium income, and portfolio performance. This fund is suitable for investors who are bullish on the development of the Korean stock market and seek stable cash flow.

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