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Hua Hong Semiconductor (1347): reported robust performance in the fourth quarter of 2025, with record sales revenue reaching US$659.9 million, a year-on-year increase of 22.4% and a quarter-on-quarter increase of 3.9%. Gross margin was 13.0%, an improvement of 1.6 percentage points year-on-year, but a slight decrease of 0.5 percentage points quarter-on-quarter. Profit attributable to owners of the parent company was US$17.5 million, a decrease of 32% quarter-on-quarter. Looking ahead to the first quarter of 2026, the company expects sales revenue to be between US$650 million and US$660 million, with gross margin expected to remain stable between 13% and 15%.
China's January social financing was supported by government bonds
The People's Bank of China released January's social financing data, which was generally in line with market expectations. Details show that the data was mainly supported by government bonds, increasing by RMB 283.1 billion to RMB 976.4 billion compared to the same period last year. However, RMB loans to the real economy decreased by 6% year-on-year to RMB 4.9 trillion, reflecting that market loan demand has not improved further and is currently at the three-year average, slightly below market expectations. Going forward, attention should be paid to the timing and planned developments of China's easing monetary policy.
On Friday, net inflows into Hong Kong stocks via the Stock Connect program totaled HK$20.219 billion. The Tracker Fund of Hong Kong (02800) saw the largest inflow at HK$3.68 billion, followed by Alibaba-W (09988) with a net inflow of HK$2.3 billion. Pop Mart (09992) recorded the largest net outflow at HK$170 million, followed by Yangtze Optical Fibre and Cable (06869) with a net outflow of HK$149 million.
The Hang Seng Index briefly dipped below 26,500 points in early trading and maintained its decline in the afternoon, ultimately closing down 465 points or 1.7% at 26,560 points; the Hang Seng China Enterprises Index fell 142 points or 1.6% to 9,015 points; and the Hang Seng Tech Index dropped 48 points or 0.9% to 5,360 points. Total market turnover was HK$257.5 billion. In terms of sectors, resource stocks retreated along with overseas gold prices, with Zijin Mining (2899) plunging 7.6%, making it one of the worst-performing blue chips. Technology stocks showed mixed performance, with Tencent Music (1698) falling sharply by 9.2%; however, Lenovo Group (0992) bucked the trend, rebounding 2.9% to become one of the best-performing blue chips. AIA Group (1299) also fell 4.2%, dragging down the overall market performance.
Source: KGI Investment Products and Solutions Department
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U.S. employment data came in weaker than expected, with initial jobless claims rising by 22{,}000 to 231{,}000, above market expectations. The cooling labor market has also prompted speculation that the Federal Reserve may deliver a larger scale of rate cuts this year…