Northbound funds | The Northbound Trading saw a net sell-off of 10.412 billion. Ahead of Alibaba's (09988) earnings report, domestic investors have increased their holdings. There is a clear divergence in pharmaceutical stocks.

On August 20, the Hong Kong stock market saw net sales of 10.412 billion Hong Kong dollars from northbound trading. Among them, the net sales from Hong Kong Stock Connect (Shanghai) amounted to 5.111 billion Hong Kong dollars, and the net sales from Hong Kong Stock Connect (Shenzhen) totaled 5.301 billion Hong Kong dollars. The stocks with the highest net purchases from northbound trading were BABA-W (09988), KUAISHOU-W (01024), and GENSCRIPT BIO (01548). The stocks with the highest net sales were TRACKER FUND OF HONG KONG (02800), CSPC PHARMA (01093), and Tencent (00700). Active stocks in Hong Kong Stock Connect (Shanghai) Active stocks in Hong Kong Stock Connect (Shenzhen) BABA-W (09988) recorded a net purchase of 2.205 billion Hong Kong dollars. Alibaba announced its earnings after hours, reporting revenue of 268.95 billion yuan for the first quarter of fiscal year 2027, a year-on-year increase of 9%, compared to the estimated 268.52 billion yuan; adjusted net profit was 20.72 billion yuan, below the estimate of 25.58 billion yuan; adjusted earnings per ADS was 8.52 yuan, whereas the estimate was 11.28 yuan. For the quarter ending June 30, capital expenditures amounted to 67.678 billion yuan, up 75% from 38.676 billion yuan in the same period last year. KUAISHOU-W (01024) experienced a net purchase of 1.143 billion Hong Kong dollars. Kuaishou disclosed in its financial report that its KuaLing AI generated revenue of over 850 million yuan in the second quarter, a year-on-year growth of over 200% and a quarter-on-quarter increase of 30.8%; core business revenue, including online marketing services and other services focused on e-commerce and KuaLing AI, increased by 7.4%, totaling 26.845 billion yuan. Pharmaceutical stocks showed significant differentiation today, with GENSCRIPT BIO (01548) and WUXI BIO (02269) seeing net purchases of 205 million and 91.83 million Hong Kong dollars, respectively, while CSPC PHARMA (01093) faced net sales of 1.091 billion Hong Kong dollars. On August 19, Moderna and Merck announced that their personalized mRNA cancer vaccine in combination with Keytruda met the criteria during the phase three trial analysis for melanoma. This is the first personalized mRNA cancer vaccine to prove effective in late-stage trials globally. Analysts noted that with foreign leading products successfully advancing in clinical trials, a large number of tumor mRNA pipelines will enter the clinical development phase, leading to a sustained explosion in demand for upstream raw materials and production outsourcing. TRACKER FUND OF HONG KONG (02800) experienced net sales of 2.758 billion Hong Kong dollars. Industrial pointed out that the current rise in Hong Kong stocks is primarily driven by valuation recovery, capital rebalancing, and a reversal of extreme sentiment, without forming a comprehensive reversal driven by widespread earnings upgrades. Huatai also stated that looking ahead, further valuation increases require advances in AI by Hong Kong companies and rising expectations for profit realization, which may necessitate stronger domestic demand policies and recovery expectations. In addition, Semiconductor Manufacturing International Corporation (00981) and Tencent (00700) faced net sales of 350 million and 408 million Hong Kong dollars, respectively.