Daily Investment Strategy
Daily focus：Weichai Power (2338)
With the recovery in heavy-duty truck demand in China and the increased penetration of liquefied natural gas (LNG) trucks, the company's core LNG engine business and diversified AIDC engine portfolio have driven a strong revenue recovery. The group's active capacity expansion, domestic substitution efforts, and orders from large customers, coupled with growing market demand for infrastructure and AI backup power, have led to significant improvements in full-year operations and earnings. The benefits of the Kion restructuring are gradually emerging overseas, while globalization and industrial chain upgrades are strengthening its growth resilience. While the current price does not fully reflect its potential, there is potential for a future revaluation.
US market volatility expect to rise
Ongoing tensions between China and the United States have become a major market uncertainty. Former US President Trump threatened sanctions on Chinese cooking oil imports in response to China's halt in soybean purchases, exacerbating the risk of supply chain disruptions. Meanwhile, with the US government shutdown entering its third week, investors are turning to gold for safe havens, exacerbating fiscal policy uncertainty, with the US Treasury Secretary predicting a 0.5 percentage point drag on GDP growth. Meanwhile, US earnings season has begun, with banks like JPMorgan Chase outperforming expectations, driving a rebound in the financial sector. Amidst the negative impact of international tensions and the government shutdown, the impact of mixed earnings will further inject volatility into the market.
Hong Kong Stock Connect recorded a net outflow of HK$5.4 billion on Wednesday, with Alibaba (9988) receiving the largest net inflow of HK$860 million, followed by Hua Hong Semiconductor (1347). Meanwhile, the Tracker Fund of Hong Kong (2800) saw the largest net outflow of HK$8.58 billion, followed by the Hang Seng China Enterprises (2828).
Leung Kai Tong is a SFC licensed person accredited to KGI Group to carry on regulated activities (for details, please refer to https://apps.sfc.hk/publicregWeb/indi/ADU276/details). He and/or his associate do not have any financial interest in the recommended issuer or new listing applicant.
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