[ET Net News Agency, 23 May 2025] US 30-year bond yields continue to stay elevated, and with the House passing Trump's tax reform bill, concerns about the US deficit have intensified, leading to further declines in US stocks on Thursday. The Hang Seng Index opened slightly higher this morning but briefly dipped by several points. However, major stock BYD (01211) reached new highs, and the strong debut of new stocks boosted the pharmaceutical sector, driving the Hang Seng Index upwards. By midday, it closed at 23,679, up 135 points or 0.6%, with turnover nearing HKD 109.4 billion. The Hang Seng China Enterprises Index reported 8,622, up 64 points or 0.8%, while the Hang Seng Tech Index reached 5,283, up 31 points or 0.6%.
"Jaseper Tsang: Market resilience and initial support at 10-day moving average"
The passage of the tax reform bill has deepened market concerns about the US deficit, contributing to the softness in US stocks. In contrast, Hong Kong stocks showed resilience, with the morning session trending upwards. Jaseper Tsang, the investment director of Rafter Capital, told ET Net News Agency that the recent decline in Hong Kong's one-month interbank rates has led to an influx of capital, enhancing the resilience of local stocks. He pointed out that the appeal of new stock activities, combined with waning confidence in dollar assets, is prompting global funds to flow back into the local market, increasing the liquidity in Hong Kong banks. Globally, currencies like the euro and yen are appreciating against the dollar, reflecting a shift of funds back to local markets. As the US tax cuts continue to progress, concerns about dollar assets are likely to increase, benefiting the performance of Hong Kong stocks.
Jaseper Tsang mentioned that the initial support level for the Hang Seng Index is around the 10-day moving average (approximately 23,500 points). He noted that since the rebound began on 16 Apr, the index has not fallen below this level. However, if US stocks experience significant volatility and the major indices drop over 3%, the Hang Seng Index may test the 50-day moving average (around 22,700 points).
"Xiaomi's stock peaks ahead of half-year results"
Xiaomi held a strategic product launch yesterday, introducing its first self-developed flagship processor, the "Xuanjie O1" chip, built on second-generation 3nm technology. The CEO highlighted that the chip's power consumption rivals that of Apple's A18 Pro, describing it as a "first-tier performance." He stated that Xiaomi aims to compete directly with Apple.
Jaseper Tsang commented that the launch of Xiaomi's chip ensures self-sufficiency in electronic device components and strengthens its hardware and software ecosystem, aligning with market expectations for Xiaomi's development direction. However, caution is warranted; should production exceed in-house needs and supply other manufacturers, this could threaten US firms like Qualcomm, potentially prompting sanctions that disrupt Xiaomi's production.
At the event, Xiaomi also unveiled its first electric SUV, the "Xiaomi YU7," positioned as a luxury high-performance vehicle. The CEO indicated that the official price will be announced in July, but estimates that the standard version will be priced at least RMB 60,000 to 70,000 higher than the Tesla Model Y's rear-wheel drive version, which is priced at RMB 263,500. He emphasized that with the YU7's superior features, it needs to be over RMB 300,000.
Regarding the YU7's pricing, Jaseper Tsang noted that the market remains cautious. While the YU7 has attractive features such as range and acceleration, its pricing above the Model Y requires evaluation upon launch.
Additionally, Xiaomi has faced recent challenges, including a self-ignition incident after a highway accident and issues regarding decorative elements on the vehicle's front. Jaseper Tsang acknowledged that such negative news could impact short-term sales, emphasizing the need for Xiaomi to address consumer safety concerns and improve public relations.
The CEO Lei Jun announced that Xiaomi plans to invest RMB 200 billion in R&D over the next five years (2026-2030). Jaseper Tsang believes this investment may weigh on profitability, highlighting the importance of Xiaomi's focus on high-end and international product development to enhance overall profitability and offset R&D costs.
On Xiaomi's stock price, Jaseper Tsang indicated that, based on an expected P/E ratio of 35 times, it will be difficult for Xiaomi's stock to surpass HKD 55 before the half-year results and sales figures for its automotive and electronic products are released.
"Jaseper Tsang: Market resilience and initial support at 10-day moving average"
The passage of the tax reform bill has deepened market concerns about the US deficit, contributing to the softness in US stocks. In contrast, Hong Kong stocks showed resilience, with the morning session trending upwards. Jaseper Tsang, the investment director of Rafter Capital, told ET Net News Agency that the recent decline in Hong Kong's one-month interbank rates has led to an influx of capital, enhancing the resilience of local stocks. He pointed out that the appeal of new stock activities, combined with waning confidence in dollar assets, is prompting global funds to flow back into the local market, increasing the liquidity in Hong Kong banks. Globally, currencies like the euro and yen are appreciating against the dollar, reflecting a shift of funds back to local markets. As the US tax cuts continue to progress, concerns about dollar assets are likely to increase, benefiting the performance of Hong Kong stocks.
Jaseper Tsang mentioned that the initial support level for the Hang Seng Index is around the 10-day moving average (approximately 23,500 points). He noted that since the rebound began on 16 Apr, the index has not fallen below this level. However, if US stocks experience significant volatility and the major indices drop over 3%, the Hang Seng Index may test the 50-day moving average (around 22,700 points).
"Xiaomi's stock peaks ahead of half-year results"
Xiaomi held a strategic product launch yesterday, introducing its first self-developed flagship processor, the "Xuanjie O1" chip, built on second-generation 3nm technology. The CEO highlighted that the chip's power consumption rivals that of Apple's A18 Pro, describing it as a "first-tier performance." He stated that Xiaomi aims to compete directly with Apple.
Jaseper Tsang commented that the launch of Xiaomi's chip ensures self-sufficiency in electronic device components and strengthens its hardware and software ecosystem, aligning with market expectations for Xiaomi's development direction. However, caution is warranted; should production exceed in-house needs and supply other manufacturers, this could threaten US firms like Qualcomm, potentially prompting sanctions that disrupt Xiaomi's production.
At the event, Xiaomi also unveiled its first electric SUV, the "Xiaomi YU7," positioned as a luxury high-performance vehicle. The CEO indicated that the official price will be announced in July, but estimates that the standard version will be priced at least RMB 60,000 to 70,000 higher than the Tesla Model Y's rear-wheel drive version, which is priced at RMB 263,500. He emphasized that with the YU7's superior features, it needs to be over RMB 300,000.
Regarding the YU7's pricing, Jaseper Tsang noted that the market remains cautious. While the YU7 has attractive features such as range and acceleration, its pricing above the Model Y requires evaluation upon launch.
Additionally, Xiaomi has faced recent challenges, including a self-ignition incident after a highway accident and issues regarding decorative elements on the vehicle's front. Jaseper Tsang acknowledged that such negative news could impact short-term sales, emphasizing the need for Xiaomi to address consumer safety concerns and improve public relations.
The CEO Lei Jun announced that Xiaomi plans to invest RMB 200 billion in R&D over the next five years (2026-2030). Jaseper Tsang believes this investment may weigh on profitability, highlighting the importance of Xiaomi's focus on high-end and international product development to enhance overall profitability and offset R&D costs.
On Xiaomi's stock price, Jaseper Tsang indicated that, based on an expected P/E ratio of 35 times, it will be difficult for Xiaomi's stock to surpass HKD 55 before the half-year results and sales figures for its automotive and electronic products are released.