Group 1 - The Hong Kong Internet ETF (159568) has shown strong performance, with a recent increase of 1.36% and a year-to-date net value increase of 52.15% [3][4] - The underlying index, the CSI Hong Kong Stock Connect Internet Index (931637), is currently viewed as being in a "valuation trough" phase, with significant support from capital, policy, and technology factors [3] - The top ten weighted stocks in the CSI Hong Kong Stock Connect Internet Index account for 72.11% of the index, including major companies like Xiaomi, Tencent, and Alibaba [6] Group 2 - The gaming market in China continues to grow, with actual sales revenue reaching 280.51 billion yuan in May 2025, a year-on-year increase of 9.86% [4] - The mobile gaming market specifically has seen a significant increase, with a market size of 211.77 billion yuan, growing by 11.96% year-on-year [4] - The industry is expected to benefit from advancements in AI and cloud gaming technologies, enhancing content production efficiency and user experience [4] Group 3 - The Hong Kong Internet ETF has a management fee of 0.50% and a custody fee of 0.10%, which are among the lowest in comparable funds [5] - The ETF's tracking error over the past three months is 0.052%, indicating the highest tracking precision among similar funds [5] - The current price-to-earnings ratio (PE-TTM) of the index is 21.7, which is below the 89.81% of the time over the past year, indicating a historical low valuation [5]

Group 1 - The core viewpoint is that the Hong Kong technology sector is currently at a convergence of "valuation trough" and "industrial transformation," with increasing investment interest driven by policy, technology, and capital factors [1] - The Hong Kong technology ETF (513020) has seen a net inflow of over 300 million yuan over the past five days, indicating strong investor interest [1] - Bloomberg analysts expect the EPS of the Hang Seng Technology Index to rise year-on-year from 2025 to 2027, suggesting a potential "valuation recovery" and "profit growth" scenario [1] Group 2 - Southbound funds and foreign capital are providing liquidity support for the Hong Kong market, enhancing the investment environment for the technology sector [1] - The index tracked by the Hong Kong technology ETF consists of up to 50 high-quality companies selected from the technology sector listed under the Stock Connect program, reflecting the overall performance of investable technology companies [1] - Investors without stock accounts can consider the Cathay CSI Hong Kong Stock Connect Technology ETF linked funds (015740 and 015739) for exposure to this sector [1]

Group 1 - The core viewpoint is that the Hong Kong stock market has shown strong attractiveness in 2025, driven by policy support and the AI boom, outperforming key markets like the US and Japan year-to-date [1] - The AI narrative initiated by DeepSeek has significantly propelled the revaluation of Chinese assets, with Hong Kong stocks leading globally at the beginning of the year. Although the AI enthusiasm has slightly cooled due to geopolitical factors, future iterations of AI models or breakthroughs in applications could reignite upward catalysts for the sector [1][2] - As of June 12, 2025, southbound capital has net purchased HK stocks amounting to 681.14 billion HKD, reaching 84.3% of the total net purchase for the entire year of 2024 (807.87 billion HKD). This influx is driven by the demand for stable returns from dividends and structural opportunities in new consumption, AI technology, and innovative pharmaceuticals [1] Group 2 - The attractiveness of Hong Kong stocks is further enhanced by their long-term valuation being relatively low. As of June 16, 2025, the Hang Seng Tech Index's latest PE (TTM) is only 20.18 times, which is at the 9.02% valuation percentile over the past five years, indicating that the current valuation is lower than 90% of the time in the last five years [2] - With the recovery of the domestic economy, expectations for AI performance catalysts, and more quality companies listing in Hong Kong, there is potential for valuation uplift in the second half of the year [2] - Relevant ETFs include the Hang Seng Internet ETF (513330), Hang Seng Pharmaceutical ETF (159892), and Hang Seng Technology Index ETF (513180) [2]

Market Overview - The Hong Kong stock market opened positively on May 2, with all three major indices closing higher. The Hang Seng Index rose by 1.74% to 22,504.68 points, the Hang Seng Tech Index increased by 3.08% to 5,244.06 points, and the Hang Seng China Enterprises Index gained 1.92% to 8,231.04 points [3]. Economic Context - The Chinese Ministry of Commerce noted ongoing discussions with the U.S. regarding tariff negotiations, indicating a willingness from the U.S. side to engage in talks [3]. - According to Everbright Securities, the Hong Kong stock market is currently in a phase of "valuation trough" and "policy window," with the Hang Seng Index approximately 12% below its ten-year valuation mean and the Hang Seng Tech Index's price-to-earnings ratio at a historical low of 8% [3]. Sector Performance - The technology sector saw a broad increase, with notable gains from companies such as Xiaomi (up over 6%), Alibaba and JD.com (both up over 3%), and Tencent, Meituan, and Kuaishou also closing higher [5]. - The new energy vehicle (NEV) sector experienced significant growth, driven by strong delivery numbers for April. Companies like Li Auto, Xpeng, and Leap Motor reported year-on-year delivery increases of 31.6%, 273%, and 173%, respectively [8]. Company Highlights - WuXi Biologics reported a revenue of approximately 9.655 billion yuan for Q1 2025, a year-on-year increase of 20.96%, with a net profit of about 3.672 billion yuan, up 89.06% [8]. - The new tea beverage sector also performed well, with Nayuki's Tea rising over 8% amid ongoing public offerings [9]. Stock Movements - Meilan Airport's stock surged by 7.71% following the announcement of a major share transfer, with the controlling shareholder transferring 50.19% of the company’s shares for a total of 2.52 billion HKD [14].

Core Viewpoint - The attractiveness of the Chinese capital market to global investors is continuously increasing, with significant capital inflows observed from various regions, particularly in technology sectors [1][9]. Group 1: Global Investment Trends - Recent data shows that global capital is actively participating in the revaluation of Chinese assets, with a notable increase in trading volumes from South Korean investors, which nearly doubled in February [2][5]. - The trend of capital flowing from U.S. tech stocks to A-shares and Hong Kong tech stocks is becoming evident, as investors seek new valuation opportunities [3][14]. - Major financial institutions like Goldman Sachs, UBS, and Morgan Stanley have released optimistic reports regarding the future performance of the Chinese stock market [2][14]. Group 2: Performance Metrics - In February, South Korean investors' trading volume in Chinese stocks surged to $782 million, marking the highest level since August 2022, significantly surpassing investments in European and Japanese markets [6]. - The MSCI China Index rose by 11.8%, the Hang Seng Index by 13.4%, and the Hang Seng Tech Index by 17.9% in February, while the MSCI Korea Index fell by 0.8% [7][14]. Group 3: Structural Changes and Investor Sentiment - The structural characteristics of the Korean stock market, dominated by companies like Samsung Electronics, contrast with the global preference for downstream AI application companies, making Hong Kong tech assets more appealing for Korean investors [8]. - There is a notable shift in foreign capital, with an estimated inflow of approximately 20 billion yuan into A-shares and around 18 billion Hong Kong dollars into Hong Kong stocks in the first two months of the year [10][11]. Group 4: Future Outlook - Analysts predict that foreign investment in Chinese stocks will continue to increase due to the low valuation of Chinese assets and supportive government policies aimed at economic growth [17]. - The potential for significant returns is highlighted by the expectation that AI applications could enhance earnings per share by 2.5% annually over the next decade, potentially attracting over $200 billion in capital [15][17].