Hong Kong stocks ended the session firmly in positive territory, closing up 1.74% after a strong open, though momentum faded slightly into the close. The overnight surge on Wall Street, where all three major indices rose over 1%, set a positive backdrop, with sentiment further bolstered by comments from a senior Fed official who signaled a potential shift towards policy easing.
The market's mood was lifted by Fed Governor Waller, who noted recent signs of cooling inflation and expressed a lean towards supporting a rate pause in September if next week's CPI data continues to improve. He highlighted that the annualized three-month core inflation rate he tracks has fallen to 3.05% in July from 4.76% in February. This effectively paves the way for a dovish pivot, creating a positive expectations gap after recent hawkish rhetoric.
With foreign investors heavily weighted in the Hong Kong market, attention remains glued to US monetary policy signals. This newfound dovish tilt has reignited expectations for looser financial conditions, with the property sector poised as a primary beneficiary. The industry itself is ripe for a rebound, particularly following the late-August policy stimulus which has shifted sentiment from pessimism to cautious optimism. Combined with the traditional "golden September, silver October" sales season, funds are speculating on a sales data recovery. However, gains are expected to favour only quality developers in core cities, while the pressure remains acute for weaker players in lower-tier cities.
Leading the property charge, Longfor Group (00960) surged over 8%, while Country Garden (02007) and China Vanke (02202) both advanced more than 6%. Sunac China (01918) jumped over 14% following its diversified business layout spanning property, property management, and cultural tourism. China Overseas Land (00688), supported by solid performance, gained nearly 5%. In the building materials supply chain, Huaxin Cement (06655) rose over 6%, benefiting from overseas capacity expansion which is restructuring its profit mix and offsetting domestic demand weakness.
The easing expectations also provided a boost to technology stocks, which continue to trade on the coattails of their US counterparts. The strong earnings from Snowflake acted as a catalyst, driving gains across the sector. In Hong Kong, application-layer stocks like Minglue Technology-W (02718), Yidu Tech (02158), Meitu (01357), and Kingdee International (00268) each climbed over 5%. China Literature (00772) also saw a significant rise of over 8%, propelled by the booming AI short-drama segment where it has demonstrated strong capabilities in batch-producing and distributing content, with a hit rate significantly exceeding market averages.
A notable development emerged as a branch of Bank of China issued the region's first "computing power Token loan," using Token consumption as a new credit metric for AI enterprises. This signals a fundamental shift where Token usage becomes a key measure of a company's product traction and market value. This concept is particularly advantageous for Maifushi (02556), a September top pick, which leverages its marketing tech platform to provide clients with Token data for credit enhancement, boasting a core competency in monetization-adjacent data, and saw its shares jump over 13%. Similarly, Paradigm Intelligent (06682) climbed over 14%, its AI Platform business showing steady growth with a substantial order backlog, while its API business revenue surged by an astonishing 860.8%. Yunzhisheng (09678) also rallied nearly 10% as its large-model Token business accelerated rapidly, with revenue surging 760% year-over-year.
In the biotech space, Akeso (09926) saw a dramatic repricing, rising over 11% today. Following initial lukewarm reaction to its head-to-head trial results against a key competitor, extensive analyst reports highlighting the dual positive outcomes on both progression-free survival and overall survival have led to a reassessment of the data as a milestone event. Attention now turns to the specific hazard ratio and whether the benefits are consistent across all patient subgroups. The positive news also lifted sentiment for related companies like Insilico Medicine (03696), which rose over 4% after its chairman announced plans to increase his shareholding.
Looking ahead, the market's focus will be on the final non-farm payroll and CPI reports before the Fed's mid-September meeting. The August jobs report is due for release, with consensus expecting a rebound to 55,000 new jobs added, while the unemployment rate is projected to hold steady.