[ET Net News Agency, 13 August 2026] Following the US July Consumer Price Index (CPI) data coming in fully in line with expectations and showing signs of cooling, market concerns over short-term interest rate hikes by the Federal Reserve have eased somewhat; however, US stocks performed softly, and Hong Kong stocks opened lower, weighed down by Tencent's (00700) earnings performance. Nevertheless, other tech stocks fell initially before recovering narrowly, coupled with SMIC (00981) and Lenovo (00992) surging ahead of their results announcements, as well as strong performances from biotech stocks. The HSI rose 17 points by midday to close at 25457, with main board turnover exceeding HKD 132.0 billion. The Hang Seng China Enterprises Index was at 8443, down 3 points or less than 0.1%. The Hang Seng Tech Index was at 4790, up 14 points or 0.3%.
"Nip Chun Pong: HSI decline maintains low turnover, downside room expected to be limited"
The HSI trended volatile this morning. Although heavy-weight stock Tencent's (00700) second-quarter revenue and profit beat expectations, its capital expenditure surged by nearly two times and free cash flow turned negative rarely, causing market concern. Its share price came under pressure today, dragging the HSI down by as much as 152 points in the early session. However, the HSI's losses gradually narrowed thereafter, even staging a rebound. Nip Chun Pong, the Chief Strategist at Solo Securities, told ET Net News Agency that since the HSI has fallen for two consecutive days, accumulating a loss of about 600 points, the room for further decline is small.
Although Tencent's second-quarter capital expenditure surged sharply, it did not drag down other heavyweight tech stocks collectively. Taking another heavyweight tech stock, Alibaba (09988), as an example, its share price fell initially before rebounding this morning, and it was not affected by a domino effect. Nip Chun Pong stated that since Alibaba has already mentioned AI expenditure when announcing its results every quarter in the past, the market was well-prepared. Unless Alibaba's actual capital expenditure shows a much larger increase than expected when announcing its results, that would be a different matter. In addition, Alibaba's pace of developing AI is earlier than Tencent's, and the harvest period for AI appears earlier. It is expected that Tencent will have to wait until at least 2028 to see a harvest in AI.
This morning, AI hardware stocks such as Lenovo (00992) and SMIC (00981) saw their share prices strengthen, helping the HSI's decline to narrow or even rebound. However, Nip Chun Pong stated that these stocks have a limited weight in the HSI, and even if their share prices strengthen, the momentum to continuously drive the broader market up is limited. Although Tencent's share price came under pressure today, other heavyweight tech stocks are expected to stabilize, and the HSI still has a chance to rebound at the close. Nip Chun Pong pointed out that as the HSI's declining market maintains a low turnover of around HKD 210.8 billion, the downside room is limited. The HSI is expected to fluctuate in a narrow range in the short term, but the chance of falling below 25300 again is not high. If it can hold steady at 25500 points at the close today, there is still a chance to reclaim 26000 points before the end of this month.
"CKI Holdings and Power Assets see soaring profits relying on asset sales, share prices find support despite no special dividend"
CKI Holdings (01038) announced that for the interim period ended 30 June 2026, profit attributable to shareholders was HKD 21.252 billion, up 3.89 times year-on-year; basic earnings per share were HKD 8.43, with an interim dividend of 75 cents paid, an increase of 2.74% year-on-year. During the period, turnover was HKD 19.631 billion, down 3.6% year-on-year. As of 30 June 2026, CKI held a net cash position of HKD 33.9 billion, representing its strongest financial position ever. The group now possesses more abundant financial strength to pursue investment opportunities in large-scale capital-intensive projects.
Power Assets (00006) announced that for the interim period ended 30 June 2026, profit attributable to shareholders was HKD 14.704 billion, up 3.83 times year-on-year; basic earnings per share were HKD 6.90, with an interim dividend of 78 cents paid, maintaining the same level for six consecutive years. Revenue for the period was HKD 298 million, a drop of 15.3%. In addition, there was a gain on the disposal of a joint venture company amounting to HKD 11.286 billion.
Nip Chun Pong stated that the surge in net profit for the above two enterprises mainly benefited from the huge gains recorded from the disposal of UK Power Networks (UKPN) and UK Rails. However, the positive news of the asset sales had long been reflected in the share prices, so the share prices of both groups reached record highs as early as May. At that time, the market even anticipated special dividends after the asset sales. Although expectations fell through, the share prices of both stocks have pulled back significantly from their May highs, so their share prices still received support from investors after the results announcements. Nip Chun Pong added that although Power Assets maintained an unchanged interim dividend, the stock's dividend yield is at the relatively high level of 4.8%. While CKI's dividend yield is only 4.2%, this time its interim dividend increased by 2.7% year-on-year, which can be considered an acceptable return.
Nip Chun Pong pointed out that both CKI and Power Assets belong to high-yield defensive stocks, and the recent softening of the HSI helps capital inflows. In addition, the market also anticipates that the groups will continue to sell assets, bringing potential positive factors for future share price increases. Nip Chun Pong believes that CKI previously experienced a pullback of over 10% from its high before regaining its upward momentum. Its current trend is decent, and there is still a chance to break through its peak in the future market. Aggressive investors may consider buying at the current price, while conservative investors can wait for the share price to pull back to around HKD 60 or HKD 61 before buying. As for Power Assets, the chance of breaking its peak is considered lower, but there is still a chance for it to rise to HKD 63, and investors may also consider buying around HKD 56 or HKD 57.
"Nip Chun Pong: HSI decline maintains low turnover, downside room expected to be limited"
The HSI trended volatile this morning. Although heavy-weight stock Tencent's (00700) second-quarter revenue and profit beat expectations, its capital expenditure surged by nearly two times and free cash flow turned negative rarely, causing market concern. Its share price came under pressure today, dragging the HSI down by as much as 152 points in the early session. However, the HSI's losses gradually narrowed thereafter, even staging a rebound. Nip Chun Pong, the Chief Strategist at Solo Securities, told ET Net News Agency that since the HSI has fallen for two consecutive days, accumulating a loss of about 600 points, the room for further decline is small.
Although Tencent's second-quarter capital expenditure surged sharply, it did not drag down other heavyweight tech stocks collectively. Taking another heavyweight tech stock, Alibaba (09988), as an example, its share price fell initially before rebounding this morning, and it was not affected by a domino effect. Nip Chun Pong stated that since Alibaba has already mentioned AI expenditure when announcing its results every quarter in the past, the market was well-prepared. Unless Alibaba's actual capital expenditure shows a much larger increase than expected when announcing its results, that would be a different matter. In addition, Alibaba's pace of developing AI is earlier than Tencent's, and the harvest period for AI appears earlier. It is expected that Tencent will have to wait until at least 2028 to see a harvest in AI.
This morning, AI hardware stocks such as Lenovo (00992) and SMIC (00981) saw their share prices strengthen, helping the HSI's decline to narrow or even rebound. However, Nip Chun Pong stated that these stocks have a limited weight in the HSI, and even if their share prices strengthen, the momentum to continuously drive the broader market up is limited. Although Tencent's share price came under pressure today, other heavyweight tech stocks are expected to stabilize, and the HSI still has a chance to rebound at the close. Nip Chun Pong pointed out that as the HSI's declining market maintains a low turnover of around HKD 210.8 billion, the downside room is limited. The HSI is expected to fluctuate in a narrow range in the short term, but the chance of falling below 25300 again is not high. If it can hold steady at 25500 points at the close today, there is still a chance to reclaim 26000 points before the end of this month.
"CKI Holdings and Power Assets see soaring profits relying on asset sales, share prices find support despite no special dividend"
CKI Holdings (01038) announced that for the interim period ended 30 June 2026, profit attributable to shareholders was HKD 21.252 billion, up 3.89 times year-on-year; basic earnings per share were HKD 8.43, with an interim dividend of 75 cents paid, an increase of 2.74% year-on-year. During the period, turnover was HKD 19.631 billion, down 3.6% year-on-year. As of 30 June 2026, CKI held a net cash position of HKD 33.9 billion, representing its strongest financial position ever. The group now possesses more abundant financial strength to pursue investment opportunities in large-scale capital-intensive projects.
Power Assets (00006) announced that for the interim period ended 30 June 2026, profit attributable to shareholders was HKD 14.704 billion, up 3.83 times year-on-year; basic earnings per share were HKD 6.90, with an interim dividend of 78 cents paid, maintaining the same level for six consecutive years. Revenue for the period was HKD 298 million, a drop of 15.3%. In addition, there was a gain on the disposal of a joint venture company amounting to HKD 11.286 billion.
Nip Chun Pong stated that the surge in net profit for the above two enterprises mainly benefited from the huge gains recorded from the disposal of UK Power Networks (UKPN) and UK Rails. However, the positive news of the asset sales had long been reflected in the share prices, so the share prices of both groups reached record highs as early as May. At that time, the market even anticipated special dividends after the asset sales. Although expectations fell through, the share prices of both stocks have pulled back significantly from their May highs, so their share prices still received support from investors after the results announcements. Nip Chun Pong added that although Power Assets maintained an unchanged interim dividend, the stock's dividend yield is at the relatively high level of 4.8%. While CKI's dividend yield is only 4.2%, this time its interim dividend increased by 2.7% year-on-year, which can be considered an acceptable return.
Nip Chun Pong pointed out that both CKI and Power Assets belong to high-yield defensive stocks, and the recent softening of the HSI helps capital inflows. In addition, the market also anticipates that the groups will continue to sell assets, bringing potential positive factors for future share price increases. Nip Chun Pong believes that CKI previously experienced a pullback of over 10% from its high before regaining its upward momentum. Its current trend is decent, and there is still a chance to break through its peak in the future market. Aggressive investors may consider buying at the current price, while conservative investors can wait for the share price to pull back to around HKD 60 or HKD 61 before buying. As for Power Assets, the chance of breaking its peak is considered lower, but there is still a chance for it to rise to HKD 63, and investors may also consider buying around HKD 56 or HKD 57.
