Zhitong Hong Kong stock trading unravels | Giant mining disaster, global copper supply and demand gap widens, Europe and US are being subject to tariffs, Chinese car companies bring opportunities

[Anatomy Dashboard]

The market rebounded yesterday. Originally, the situation was very good, but the latest talks between China and the US have become discordant. Hong Kong stocks fluctuated and settled today, and the Hang Seng Index fell 0.13% at the close.

According to sources, US and Chinese officials will hold staff-level technical talks on trade and economic issues at the US Treasury on Thursday, but they will not involve China's latest agreement to transfer TikTok's US business to US control. US Treasury Secretary Bessent said that aircraft engines and parts, and some chemical products and IPOs may become important bargaining chips between China and the US in negotiations with China. Even IPOs will have to come to the negotiation table. No wonder the market is rapidly spreading rumors that ByteDance will be listed in Hong Kong. This must be false news that the rumor has already been refuted. We are also tit-for-tat: the Department of Commerce issued an announcement deciding to add 3 US companies to the list of unreliable entities and 3 US entities to the export control list. It's still an old routine, pulling over and over again. It is certainly not good for the stock market to continue like this.

However, the overall impact will not be significant. Alibaba (09988) is making big efforts on AI across the board, providing an important boost to technology stocks. The continued rise in the Hang Seng Technology Index is the best explanation. Huahong Semiconductor (01347) and ZTE (00763) both rose more than 4% today.

The core product, Ningde Era (300750.SZ), once surged nearly 6%, and its stock price reached a record high. The total market capitalization also broke through 1.8 trillion yuan for the first time, surpassing Kweichow Moutai (600519.SZ) and temporarily ranked third in the total market value of A-shares. The Ningde Era H shares mentioned yesterday also rose more than 5%. It is a general trend for high-tech enterprises to surpass traditional industries. China Airlines (03931) mentioned also rose by more than 6%.

Grasberg, the world's second-largest copper mine, experienced another sudden outbreak. Two employees died and five people disappeared at Indonesia's Grasberg mine. Freeport, headquartered in Arizona, USA, warned on Wednesday that it might not be able to fulfill the mine's supply contract, and also lowered its copper and gold production expectations for this season. The copper supply and demand gap has widened further. China Nonferrous Metals Industry Association Copper Branch: Resolutely opposes “internal rolling” competition in the copper smelting industry. Under double benefits, Luoyang Molybdenum (03993), China Nonferrous Mining (01258), Minmetals (01208), and Jiangxi Copper shares (00358) all rose by more than 8%; China Metallurgical (01618): China Metallurgical (01618): The amount of copper resources in the company's Siadik copper mine in Pakistan reached 3.78 million tons. The Pakistan side's approval was basically completed in the first half of 2025, and domestic procedures accelerated; Afghanistan's Enak copper mine is one of the largest undeveloped copper deposits in the world, with resources of 12.36 million tons. Construction phase. Today it surged more than 9%. Note that domestic tungsten ore stocks are seriously insufficient. According to the “Economic Observer”, domestic APT (ammonium paratungstate, tungsten concentrate intermediate goods stocks have now dropped below 200 tons (normal level is 600 tons), hard alloy companies' raw material stocks are only 12 days left (safety line 30 days), and Hong Kong stocks have Jiaxin International Resources (03858).

The Trump administration issued an official announcement on Wednesday to implement the trade agreement reached with the European Union, confirming that as of August 1, imported EU cars and auto parts will be subject to 15% tariffs. European cars are not very competitive in the first place; this only worsens the situation. Chinese car companies will open up new horizons in Europe. BYD (01211) sales in Europe surged 200% year on year in August, surpassing Tesla for two consecutive months. The company's special consultant for Europe: To expand production in Europe in the future, batteries need to be produced locally. Currently, the volume is not large; if the European production line is built, it will start. Buffett has also reduced his holdings, so there won't be that much pressure to increase in the future. Today's increase was more than 2%; Zero Sports (09863) unveiled a new hatchback model B05 at the Munich Motor Show in September, adding another product to the company's European product lineup. The company officially announced the launch of its 1,000th vehicle, marking that it has become the second new-power car builder in China to enter the “One Million Club”. Today's increase of nearly 7%; Xiaopeng Motors (09868): Auto parts supplier Magna (Magna) said in September that Xiaopeng has selected the company to assemble two models for the European market in Graz, Austria, starting in the third quarter of 2025. Today's increase is nearly 4%; Geely Auto (00175) will launch the Geely brand in the UK. The first model to be sold is the EX5 electric SUV, which will be launched in the early fourth quarter.

Let's talk about Chery Auto (09973), which went on sale today. It opened at HK$34.2, up more than 11% from the subscription price of $30.75, and closed at HK$31.92. The company also has a presence in the European market, and its three gasoline-engine SUVs will debut in Poland in November. Earlier this year, the group launched the Chery brand in the UK and promoted the Omoda and Jaecoo brands in six or seven European markets including Spain, Italy, and Poland. Chery's successful listing today is a major stimulus for Cornerstone Investor Horizon Robot (09660), which is up nearly 3% today.

Yesterday, Xiaomi was also mentioned (01810): Xiaomi plans to set up an electric vehicle showroom in Europe and achieve local production in 2027. In terms of mobile phones, the Xiaomi 17 series will be the world's first to be equipped with Qualcomm's fifth-generation Snapdragon 8 Extreme mobile platform. Lei Jun said, “There is no increase in price” while the standard version of the Xiaomi 17 has been drastically upgraded. Today's increase is over 4%.

On September 24, China Fusion Energy Co., Ltd., with a registered capital of 15 billion yuan, made its first public appearance at the Shanghai Industrial Fair and announced the launch of the China Circulation 4 (HL-4) experimental device 145. The device uses full-temperature superconducting magnet technology, which is 40% smaller than traditional tokamaks, but the fusion power density is 3 times higher. It is expected that technical verification will be completed by 2030, directly targeting commercial targets in 2050. The prospects for nuclear fusion are very broad, but actual commercial use will take time. Shanghai Electric (02727), which has superconducting magnets on the equipment side, rose more than 10%, and Tiangong International (00826), which has irradiation-resistant steel on the material side, rose more than 5%.

China Everbright Holdings (00165) ushered in a value revaluation: the stock price of Circle, the leading US stablecoin in early investment, increased more than 3 times during the year, Hong Kong stock Dekang Agriculture and Animal Husbandry increased by more than 2 times, NetEase Cloud Music increased by about 150%, and there are also unlisted projects: the company indirectly holds about 12.6% of SMEE's shares through the Guangwei Qinghe Investment Center. Based on a valuation of 600 billion yuan in 2025, the market value of shares held reached HK$647-71.9 billion, which is close to its own market value (about HK$13 billion). The Hong Kong stock IPO of Tesla Union has entered the sprint stage, and the AIoT unicorn in which Everbright Holdings holds 26.14% of its shares, has completed the filing for overseas issuance and listing. It is expected to be listed in the third quarter of 2025. Today it surged nearly 26%. Zhitong Gold Stock Skyworth Group (00751) once again rose more than 7% in September.

[Section Focus]

According to a report by “Nikkei Asia” on September 25, as the US tightens its rare earth resources amid ongoing trade tension, the rise in rare earth metal prices has begun to exceed the scope of minerals covered by China's export restrictions, and light rare earth prices that are not restricted by China have also soared recently. According to the data, as of September 18, the trading price of dysprosium in the European market was 840 US dollars per kilogram, which is about three times that of April. The price of terbium, another rare earth that is subject to China's export control, has reached 3,600 US dollars per kilogram in Europe, reaching record highs many times. However, the price of light rare earths, which are not targeted by China's export restrictions, has also risen rapidly recently. Take neodymium and praseodymium as an example. At the end of August, the price of praseodymium in China once rose to 90,850 US dollars per ton, the highest level since March 2023. Currently, the price is still hovering near its highest level in about two and a half years. The price of neodymium is also rising. Since the beginning of June, the price of metal neodymium has risen by nearly 50%.

As a national-level strategic resource, long-term control is inevitable, and the price of rare earths can be described as rising and not falling. The main varieties in the Hong Kong stock market: Jinli permanent magnets (06680) and Chinese rare earths (00769).

[Individual Stock Mining]

Jinshan Cloud (03896): Placement raises funds to expand AI business and public cloud business performs brilliantly

Jinshan Cloud recently announced that it will place 338 million new shares at HK$829 per share. The net proceeds from the placement are estimated to be about HK$2.76 billion, 80% of which will be used for AI business development, including upgrading infrastructure and cloud service capabilities. The rest of the capital will supplement the company's operating needs. After this placement, Jinshan Software held 32.94% of the shares and Xiaomi held 10.29% of the shares. The company's Q2 revenue was 2.35 billion yuan, up 24.2%/19.3% year over year, respectively.

Comment: After this placement, it will play a key role in the company's subsequent development. The company's core benefits from continued high AI revenue growth, driving strong growth in the company's overall performance, and excellent public cloud business performance. By business, AI is the core driver. 25Q2 public cloud service revenue was 1.63 billion yuan, up 32% year on year (Q1 was 14%); of these, AI revenue was 730 million yuan, up more than 120% year on year, achieving 8 consecutive quarters of three-digit growth, accounting for 45% of public cloud service revenue; the increase in demand for intelligent computing clouds also led to an increase in revenue for basic cloud products. Looking at each customer, Jinshan+Xiaomi's contribution increased. 25Q2's revenue from Jinshan+Xiaomi was 630 million yuan, an increase of 69.5% over the previous year, and the revenue share has increased to 27%; 25H1 has completed 40% of the upper limit of related transactions this year. Looking forward to the future, it is expected that the public cloud AI business will maintain strong growth as the company continues to invest in AI-related resources, while relying on the synergy advantages with the Xiaomi & Jinshan ecosystem. Industry Cloud 2Q25 grew faster, and AI projects in various fields were implemented and delivered. The 2Q25 industry's cloud revenue was 724 million yuan, up 10.1%/17.4% year over year. The core benefits from the continued growth in customer demand for software IT services and the accelerated completion of Q2 project delivery. In the field of public services, the company comprehensively promoted government cloud and state-owned cloud services, and jointly released the Jinshan Government AI all-in-one machine with the Jinshan Office. The company completed a new round of financing in Q2. As of the end of June, the company's cash, cash equivalents and restricted cash reserves were 5.52 billion yuan. Xiaomi's investment in AI is clear, and Jinshan Cloud will directly benefit from increased demand for training such as pedestal models and smart driving.