Northbound funds | Northbound net selling reached 1.670 billion. Northbound funds snapped up Z.AI (02513) over HK$1.7 billion and sold off CNOOC (00883) over HK$800 million.

On October 23 in the Hong Kong stock market, northbound trading recorded a net sell of HK$1.670 billion. Among this, Stock Connect (Shanghai) recorded a net sell of HK$2.599 billion, while Stock Connect (Shenzhen) recorded a net buy of HK$929 million. The stocks with the largest net buys by northbound funds were Z.AI (02513), Tencent (00700), and CSOP Hang Seng TECH Index ETF (03033). The stocks with the largest net sells by northbound funds were BABA-W (09988), CNOOC (00883), and Semiconductor Manufacturing International Corporation (00981). Active stocks under Stock Connect (Shanghai) Active stocks under Stock Connect (Shenzhen) Z.AI (02513) and MINIMAX-W (00100) received net buys of HK$1.738 billion and HK$306 million, respectively. China Securities Co.,Ltd. pointed out that domestic models are expected to enter a new round of iteration cycles. DeepSeek V4.1-Flash-1017 was simultaneously switched across web, App, and API and open-sourced. Kling 4.0 was officially fully launched. Following the intensive upgrades of core overseas models in September-October, domestic models will also usher in a relatively intensive round of iterative upgrades in Q4. The market looks forward to subsequent releases such as GLM5.5, M3Pro, and K3.1. Tech internet stocks continued to diverge. Tencent (00700) and CSOP Hang Seng TECH Index ETF (03033) received net buys of HK$1.295 billion and HK$580 million, respectively, while BABA-W (09988) suffered a net sell of HK$1.405 billion. Citi stated that the recent selloff in Chinese equities suggests market sentiment is near or has reached an extremely pessimistic level. Commitments by large Chinese internet companies to significantly increase capital expenditure have led the market to lower earnings forecasts for these companies and exacerbated pessimism across the sector. However, Citi believes that even after factoring in a potential further 10%-30% earnings downgrade, the valuation of China's internet sector remains attractive. AI hardware stocks regained increased positions. Zhongji Innolight (03308), YOFC (06869), and KB LAMINATES (01888) received net buys of HK$191 million, HK$53.81 million, and HK$9.39 million, respectively. Technology companies including Zhongji Innolight, Eoptolink Technology Inc., and Suzhou TFC Optical Communication jointly issued announcements on recent production and operating conditions to stabilize market confidence. Zhongji Innolight said that the company's production and operations are currently all normal, the supply chain is stable, capacity utilization is sufficient, and customer order demand is strong. Downstream demand remains highly prosperous, and the company has a full order backlog. JPMorgan stated in its latest research report to clients that the recent selloff in AI-related stocks may be nearing an end. CNOOC (00883) suffered a net sell of HK$801 million. Citi published a research report stating that the normalization of crude oil exports from the Arabian Gulf is mainly reflected in volume rather than logistics, and unprecedented shipping inefficiencies are keeping landed crude oil costs elevated. The freight rate for very large crude carriers (VLCCs) from the Arabian Gulf to China has recently approached US$250 per ton, equivalent to about US$35 per barrel, more than 20 times the average level of the past decade. In addition, Hua Hong Grace Semiconductor (01347) and 51WORLD (06651) received net buys of HK$53.45 million and HK$17.43 million, respectively, while Semiconductor Manufacturing International Corporation (00981) and GenScript Biotech (01548) suffered net sells of HK$798 million and HK$305 million, respectively.