Northbound funds | North Water's net purchase of 9.038 billion yuan, significant differentiation in AI hardware stocks, North Water continues to increase its holdings in KNOWLEDGE ATLAS (02513) by over 4.7 billion Hong Kong dollars.

On July 13, the Hong Kong stock market saw a net buying of 9.038 billion HKD by Northbound investors. Among them, the net buying through the Shanghai-Hong Kong Stock Connect was 7.874 billion HKD, and the net buying through the Shenzhen-Hong Kong Stock Connect was 1.164 billion HKD. The top stocks that Northbound investors bought the most were KNOWLEDGE ATLAS (02513), TRACKER FUND OF HONG KONG (02800), and NTES (09999). The top stocks that Northbound investors sold the most were KB LAMINATES (01888), KINGBOARD HLDG (00148), and YOFC (06869). Active trading stocks through the Shanghai-Hong Kong Stock Connect Active trading stocks through the Shenzhen-Hong Kong Stock Connect KNOWLEDGE ATLAS (02513) saw a net buying of 4.736 billion HKD. On July 11, the founder of KNOWLEDGE ATLAS, Mr. Tang Jie, released an internal memo titled "The Big Wave Is Coming," where the core information was about KNOWLEDGE ATLAS launching the "Touch High Plan" in the next two years, challenging the current technological limits and algorithms, with a focus on long-term tasks, autonomous intelligent agents, self-training, and model security. TRACKER FUND OF HONG KONG (02800) saw a net buying of 2.7 billion HKD. Guosen believes that the upcoming disclosure window for the semi-annual reports in July and August will shift the pricing logic from style speculation to performance verification, and with multiple factors resonating, it is unlikely to continue the extreme market situation of the second quarter. Guotai Haitong believes that as the impact gradually dissipates, coupled with the increasing possibility of the Hong Kong stock market bottoming out in the mid-year reports, the market is expected to return to the basic understanding of price-performance ratio. NTES (09999) saw a net buying of 1.527 billion HKD. NTES was added to the list of stocks under the Hong Kong Stock Connect, effective from June 30. HAITONG INT'L believes that after being included in the Hong Kong Stock Connect, NTES's daily turnover is expected to increase to about 34 billion HKD, representing a growth of about 60%. Guosheng stated that the second half of 2026 to the beginning of 2027 is expected to boost performance with a new product cycle. GigaDevice Semiconductor Inc. (03986) saw a net buying of 8.27 billion HKD. The storage chip sector faced a wave of limit-downs, with a company representative from GigaDevice Semiconductor Inc. stating that this round of price adjustments is highly linked to external markets, with the company's stock price adjustment being similar to SK Hynix's, with a decline of over 30%. As for concerns about the company's business, the representative mentioned that the performance guidance is the most convincing proof of their performance. Semiconductor Manufacturing International Corporation (00981) saw a net buying of 4.79 billion HKD, while Hua Hong Grace Semiconductor (01347) faced a net selling of 10.34 billion HKD. Morgan Stanley warned that there are more signs indicating that chip manufacturers have limited pricing power, meaning that these stocks may have risen too much due to optimistic sentiment towards AI expenditures. The analysts pointed out that the AI data center technology stack is being redesigned to include self-designed chips with lower costs, with many major cloud service providers designing these chips themselves. KB LAMINATES (01888), KINGBOARD HLDG (00148), and YOFC (06869) faced net selling of 3.214 billion, 1.836 billion, and 1.1 billion HKD, respectively. Guolian An Fund stated that the recent overseas market sell-off is due to the loosening of the AI hardware race trading density, with market concerns about excessive speculation in the previous AI frenzy, leading to collective fund disinvestment. In the first half of the year, core sectors such as semiconductors, AI computing power, and optical modules saw strong performance, with most popular targets experiencing significant gains, accumulating a large amount of floating profit chips and accumulating short-term downside risks. The adjustment started with the most popular stocks with the highest gains of the year, showing clear profit-taking characteristics. In addition, BABA-W (09988) saw a net buying of 5.83 billion HKD, while Tencent (00700) faced a net selling of 2.3 billion HKD.