Daily focus：NetEase (9999)
Q3 2025 results show net revenue of RMB 28.4 billion, up 8.2% year-on-year. While slightly below some market expectations, non-GAAP net profit attributable to shareholders was RMB 9.5 billion, generally in line with expectations. Core game and related value-added service revenue was RMB 23.3 billion, up 11.8% year-on-year. Looking ahead, strong deferred revenue suggests that the game business will remain solid in the fourth quarter. With the launch of "Where Winds Meet" and the pipeline of several major new products, including "ANANTA" in 2026, the company possesses multiple growth catalysts.
September Non-Farm Payrolls Higher Than Expected
Expectations for a December rate cut have shifted dramatically, with the probability plummeting from near certainty a month ago to 39%. The driving factor is the unexpectedly strong US September jobs data, released after a delay. The US added 119,000 jobs, far exceeding market expectations of 50,000, while core inflation remained at 3%, slowly approach the Fed's 2% target. This shift will directly impact the global liquidity outlook—the prolonged high US interest rates mean increased attractiveness for dollar-denominated assets, putting pressure on emerging markets and interest rate sensitive growth assets.
Hong Kong Stock Connect saw a net inflow of HK$15.9 billion on Thursday, with the Tracker Fund of Hong Kong (2800) experiencing the largest net inflow at HK$7.42 billion, followed by the Hang Seng China Enterprises Fund (2828). On the other hand, Xiaomi Group (1810) recorded the largest net outflow at HK$610 million, followed by Pop Mart (9992).
Hong Kong stocks continued their downward trend throughout the day, following the overnight plunge in US tech stocks, with all three major indices falling. The Hang Seng Index closed at 25,220 points, down 615 points or 2.38%; the H-share Index fell 223 points or 2.45% to 8,919 points; and the Hang Seng Tech Index fell 179 points or 3.21% to 5,395 points. Total turnover for the day was HK$285.7 billion. Tech stocks faced heavy selling pressure, with JD Health (6618) falling 8.6%, making it the worst-performing blue chip; Link REIT (823) suffered its second consecutive day of heavy losses due to a reduced interim distribution and expectations of a deteriorating operating environment, closing at HK$35.9, down 7.47%; Baidu (9888) fell 5.8% to HK$107.3; and Alibaba (9988) fell 4.6% to HK$147.6. Xiaomi (1810) bucked the trend, rising 1%.
Source: KGI Investment Products and Solutions Department
The materials contained herein are provided by KGI Asia Limited ("KGI") for information only. While such materials are based on or derived from sources believed to be reliable, KGI makes no representation or warranty (express or implied) as to their accuracy or reliability. Neither the information nor the opinions expressed herein constitute, or are to be construed as, an offer or invitation or solicitation of an offer to buy or sell any securities or investments. KGI and its officers, employees, agents and affiliates may have interests in the securities or investments covered herein and accept no liability whatsoever for any loss or consequence whatsoever (whether direct or indirect) resulting from any use of or reliance by you on such materials.
The AI Big four spent $230bn in capex. AI applications are driving demand for data centers and energy facilities, boosting jobs and productivity, as well as supporting U.S. GDP growth…