Northbound funds | Net purchases of 16.573 billion yuan in the northern water market. Domestic investors once again increased their positions in Hong Kong stock ETFs and technology stocks, rushing to subscribe to Tracker Fund of Hong Kong (02800) with over 6.3 billion Hong Kong dollars.

On August 26, in the Hong Kong stock market, mainland Chinese investors made a net purchase of 16.573 billion Hong Kong dollars, with a net purchase of 9.605 billion Hong Kong dollars through the Shanghai-Hong Kong Stock Connect and a net purchase of 6.967 billion Hong Kong dollars through the Shenzhen-Hong Kong Stock Connect. The stocks with the most net purchases by mainland Chinese investors were TRACKER FUND OF HONG KONG (02800), Hang Seng H-Share Index ETF (02800), and BABA-W (09988). The stocks with the most net sales by mainland Chinese investors were Semiconductor Manufacturing International Corporation (00981), EAST BUY (01797), and XIAOMI-W (01810). Active trading stocks through the Shanghai-Hong Kong Stock Connect and Shenzhen-Hong Kong Stock Connect included TRACKER FUND OF HONG KONG (02800) and Hang Seng H-Share Index ETF (02828), receiving net purchases of 6.545 billion and 1.779 billion Hong Kong dollars respectively. It was reported that due to the high probability of a rate cut in September and the significant return of Hong Kong stocks relative to A shares this year, the A-H market will return to a unified starting line, with changes in corporate earnings becoming the driver of performance differences between the two markets. Tech-related stocks were also in demand. BABA-W (09988), Tencent (00700), and MEITUAN-W (03690) received net purchases of 1.345 billion, 670 million, and 409 million Hong Kong dollars respectively. The National Development and Reform Commission, the State Administration for Market Regulation, and the Cyberspace Administration of China recently jointly drafted the "Internet Platform Price Behavior Rules (Draft for Solicitation of Opinions). Citigroup indicated that major e-commerce platforms are likely to retain certain levels of subsidies in order to maintain market share and cater to the changing consumer behavior under new consumption concepts in China. MEITU (01357) received a net purchase of 315 million Hong Kong dollars. Global index company MSCI previously announced the results of its August 2025 index review, including the inclusion of MEITU in the MSCI China Index, which will officially take effect after the market closes on August 26. Moreover, Morgan Stanley released a research report expressing optimism about MEITUs long-term growth potential and reiterating a "Buy" rating with a target price increase from 14.4 Hong Kong dollars to 15.7 Hong Kong dollars. INNOVENT BIO (01801) received a net purchase of 125 million Hong Kong dollars. INNOVENT BIO announced that the FDA approved the new drug clinical trial application for its self-developed PD-1/IL-2-bias bispecific antibody fusion protein IBI363 for the first global Phase III clinical trial study (MarsLight-11), which is intended to treat immune-resistant non-small cell lung cancer (NSCLC) patients. Chip stocks showed differentiation, with HUA HONG SEMI (01347) receiving a net purchase of 38.39 million Hong Kong dollars, while ZTE Corporation (00763) and Semiconductor Manufacturing International Corporation (00981) faced net sales of 53.51 million and 982 million Hong Kong dollars respectively. The Ministry of Industry and Information Technology recently emphasized at the 2025 China Artificial Intelligence Computing Power Conference the need to guide the construction of computing power facilities in an orderly manner and accelerate breakthroughs in key core technologies such as GPU chips. Orient believes that with improvements in domestic AI chip design technology and manufacturing processes, as well as the continuous development of domestic large models and support for domestic chips, the market share of domestic computing power is expected to continue to rise, and the market for domestic chips is expected to continue to advance.