Zhitong Hong Kong Stock Exchange Unravels | US Credit Continues to Be Consumed, Gold Is Being Consumed, and Pharmaceuticals Become the Main Line of Capital Gathering

[Anatomy Dashboard]

Today, the two markets showed a differentiated trend. A shares experienced a rapid dive in the afternoon and continued to weaken at the end of the session. Although Hong Kong stocks were also affected, the end of the market closed. The Hang Seng Index closed up 0.24%.

The reason why A-shares are diving is that futures prices have reached historical extremes. The volatility of put options is much higher than that of subscriptions. Simply put, there are many shorting. In the past, snowball products were bulls in stock index futures. After being restricted, the strength of the bulls was weakened, and now quantitative neutrality has become short in the market. As a result, the trend of A-shares is difficult to see.

The above are just results. From the source, it is the US debt problem and the tariff issue that the market is more concerned about. The latest negotiations between Europe and the US are very fuzzy. The US is putting pressure on it to escalate and demand “unilateral concessions”; otherwise, the 20% tariff cannot be avoided. As one of America's largest trading partners, the EU is currently facing a difficult choice: either accept the US side's demand to reduce tariffs unilaterally, or refuse to compromise and risk high tariffs imposed by the US, which will have a serious impact on the European economy. If things don't go well, neither side will have a better day.

The US government announced on the 22nd that it will cancel the student and exchange scholarship program qualifications obtained by Harvard University and prohibit the university from enrolling international students. According to this decision, apart from not being able to enroll international students, existing foreign students must transfer to Harvard University, otherwise they will lose their legal status. Homeland Security Secretary Norm accused Harvard University of “creating an unsafe campus environment, hostile to Jewish students, promoting sympathy for Hamas, and implementing a racist policy of 'diversity, fairness, and inclusiveness. '” At the end of the day, it's political sacrifices. This has had a huge impact, and America's credit is constantly being consumed.

Speaking about the chaos in the Middle East yesterday, Israel pointed the finger at Iran. Iran's foreign minister responded to Israel's attack plan: it will not hesitate to retaliate against any attack, and at the same time shouted for the US. If Israel carries out an attack, the US will definitely be involved and take responsibility. Yesterday, it was pointed out that safe-haven funds will use Bitcoin or gold again. Today, Lingbao Gold (03330) surged more than 9%, and Chifeng Gold (06693) and China Gold International (02099) both rose nearly 3%. Minmetals Resources (01208): Las Bambas, the flagship mine in Peru in South America, is the company's most important asset; the decline in Las Bambas production and cost is expected to exceed expectations. At the same time, considering the reduction in interest expenses, the company's overall performance is expected to exceed expectations. Today's increase is over 7%.

The main reason why the trend of Hong Kong stocks is much more stable today is that the Hong Kong stock market has gathered a large number of high-performing varieties. For example, leading pharmaceutical companies are all in the Hong Kong market. Yesterday, it was mentioned that Hengrui Pharmaceutical (01276) landed in Hong Kong stocks today, with a sharp rise of more than 25% at the close, continuing to boost the sentiment of pharmaceutical stocks. Looking at industrial catalysts, the May ASCO conference is approaching, and many innovative pharmaceutical companies will disclose major data at ASCO, and many domestic innovative pharmaceutical companies are expected to usher in catalysis. Also, according to the latest Act passed by the Danish Parliament on the 22nd, the legal retirement age in Denmark by 2040 is 70, applicable to those born after December 31, 1970. The low birth rate of the population in relatively developed countries is a common problem, and delaying retirement is a last resort. This is also an important logic for the strengthening of pharmaceutical stocks. Kangzhe Pharmaceutical (00867) surged more than 13%, while CXO Tiger Pharmaceuticals (03347), Zhaoyan New Pharmaceutical (06127), and Kanglong Chemical (03759) all increased by more than 6%. Other pharmaceuticals have risen a lot. Pharmaceuticals are the main line, and large amounts of capital are speeding up the flow into pharmaceutical ETFs.

There are also giants such as Xiaomi (01810). On May 22, the Xiaomi YU7 was officially released. Lei Jun made a big announcement that all cars are equipped with lidar assisted driving as standard. In order to improve the safety of assisted driving, the Xiaomi Yu7 series now comes standard with the Nvidia THOR in-vehicle computing platform, 1 lidar, 1 4D millimeter wave radar, 11 high-definition cameras, and 12 ultrasonic radars. As for the pricing of the Xiaomi YU7, Lei Jun said bluntly that the ModelY starts at 263,500 yuan. Judging from the configuration of the Xiaomi YU7, it should be at least 670,000 yuan more expensive than the ModelY. The exact price will have to wait until it is released in July. Sagiteng Juchuang (02498), which provides lidar to Xiaomi: It announced a strategic cooperation with Mammotion to jointly develop a high-end intelligent mowing robot solution based on automotive-grade all-solid-state lidar technology. The first batch of orders was agreed to cooperate for 1.2 million units within three years. Furthermore, RoboSense Sagitengjuchuang officially released the true 192 line automotive high-performance digital lidar eMX last month, setting a new benchmark for the popularity of digital lidar. Today it's up nearly 6%. Related intelligent driving categories such as Nexteer (01316): Order volume in the first quarter of this year increased 60% year-on-year, and the momentum is strong. The company has production capacity layouts in the US and Mexico, and has capacity coordination capabilities. The company can minimize the impact of tariffs by coordinating production capacity. Today's increase was over 4%, and Zhejiang Shibao (01057) also surged nearly 9%.

US President Trump is expected to invoke wartime defense production laws to deal with America's dependence on foreign countries in uranium enrichment and nuclear fuel processing. Trump will sign a number of related executive orders as soon as Friday. CGN Mining (01164) rose more than 8%. The consumer side continued to follow the spiritual direction of film and television entertainment. Alibaba Pictures (01060) strengthened again, driving Reading Group (00772) to increase by more than 8%, while Maoyan Entertainment (01896) also rose by more than 4%. NetEase Cloud Music (09899) rose more than 5%.

Individual stocks in the performance forecasting category are also being sought after. Eneng Logistics (09956) will disclose the first quarter results on May 26 (that is, next Monday). According to the 2025 performance guidelines previously updated by Eneng Logistics, the company expects revenue growth of 10%-15%, a steady increase in gross margin, and no less than 20% increase in adjusted net profit. Today's increase is more than 7%; Johnson Electric Holdings (00179) will release full year results next week. Relying on its deep accumulation in the fields of brushless DC motors, gears and metal processing, the company has strong technical integration capabilities. Entering the humanoid robot industry is expected to open up room for a second growth. I mentioned yesterday that today it will once again soar by more than 11%. The Shanghai and Shenzhen Stock Exchange announced a few days ago that due to Fuzhikang (02981)'s share merger, Fuzhikang will be transferred to the Hong Kong Stock Exchange's securities list in accordance with relevant regulations, with effect from May 20. Generally, transfers are highly sought after. In addition, the company spent HK$1,256,800 to buy back 151,000 shares on May 23, 2025. Today's increase is over 22%.

[Section Focus]

The reporter asked a question. Dutch Foreign Minister Veldkamp said during a meeting with reporters on Thursday that during his current visit to China, Chinese officials had raised with him the issue of easing semiconductor export controls. Can the Ministry of Foreign Affairs confirm the claims and provide further details? Mao Ning said that during Foreign Minister Feldkamp's visit to China, Vice Premier Ding Xuexiang and Foreign Minister Wang Yi held separate meetings and talks with him to have an in-depth exchange of views on bilateral relations and issues of common concern. The foreign ministers of the two countries also reached a six-point agreement. The Chinese side has already released information on the specific situation, so you can check it out. On semiconductor export control issues, China has stated its position many times. The semiconductor industry is highly globalized, and the formation of the production and supply chain is the result of market and enterprise choices. Based on the preliminary judgment above, the talks have reached certain results. Of course, the details will have to wait for the second round of negotiations. Probably speaking, deregulation is expected.

Good chip category, main varieties: SMIC (00981), Huahong Semiconductor (01347), Shanghai Fudan (01385).

[Individual Stock Mining]

China Gold International (02099): Strong growth in the first quarter, mine profitability continued to increase

China Gold International's revenue for the first quarter of 2025 increased 351% year-on-year to US$273 million, and net profit reached US$86 million. Compared with a net loss of US$26 million in the same period last year, it turned a loss into a profit.

Comment: The company's strong performance growth in the first quarter was mainly due to the rise in gold and copper prices and the increase in production brought about by the resumption of production at the Jiama mine. China Gold International is the only overseas listing platform belonging to China Gold Group. In terms of production, total gold production increased 116% year-on-year to 44,797 ounces, and total copper production increased to 37.3 million pounds (about 16,911 tons), a significant increase from 4.6 million pounds (about 2,093 tons) in the same period last year. In addition, operating cash flow was US$144 million, a significant increase from US$7.2 million in the same period in 2024, reflecting an increase in the company's operating efficiency. The resumption of production at the company's Jiama mine throughout the year is expected to usher in a sharp rise in volume and price, and the performance will enter a rapid growth channel. Since the second half of 2024, the Jiama mining area has resumed production. The daily mineral processing capacity has been restored to 34,000 tons, and it is planned to complete the construction of the Phase III tailings depot in the first half of 2027. At that time, the daily mineral processing capacity is expected to increase to 44,000 tons/day. Furthermore, the company is actively promoting the upper limit of mining licenses to 50,000 tons/day to support higher production targets. According to the company's guidelines, the copper production of the Jiama mine is expected to reach 63-67,000 tons in 2025, and the gold production range is 2.15-2.3 tons. AISC costs will drop further, and the mine's profitability will continue to increase. The company has huge room to increase its reserves of resources in the Jiama mine. Currently, exploration projects at Zegulang North and Bayi Ranch are progressing in an orderly manner. It is expected that the latest exploration report will be issued in 2026, and the resource reserves are expected to increase dramatically.