On June 10th in the Hong Kong stock market, net purchases by northbound funds totaled HK$8.243 billion.

Specifically, net buying through the Shanghai-Hong Kong Stock Connect was HK$9.019 billion, while the Shenzhen-Hong Kong Stock Connect saw net selling of HK$776 million.

The stocks receiving the largest northbound inflows were the Tracker Fund (02800), Tencent Holdings Ltd (00700), and Yangtze Optical Fibre and Cable Joint Stock Ltd (06869).

The stocks with the largest net outflows were Alibaba Group Holding Ltd (09988), CNOOC Ltd (00883), and Semiconductor Manufacturing International Corporation (00981).

Mainland Funds Boost Holdings in Hong Kong ETFs

Northbound capital once again increased its holdings in Hong Kong ETFs, with net purchases of HK$4.056 billion for the Tracker Fund (02800) and HK$357 million for the CSOP Hang Seng Tech Index ETF (03033).

CMB International Securities believes negative factors for the Hong Kong market are nearly exhausted, leaving it at a structural bottom with "a floor below and catalysts awaited above."

Short-term upside is seen as dependent on two catalysts: AI-driven valuation reassessments and marginal improvements in earnings, with mid-year results in August being a key verification point.

Guotai Haitong Securities stated that once headwinds subside, the market's perception of Hong Kong stocks' value for money is expected to return.

Tencent Attracts Significant Inflows

Tencent Holdings Ltd (00700) received net inflows of HK$1.994 billion.

Bank of America Securities anticipates that the WeChat AI agent will be gradually rolled out through multiple beta tests, with a full public test potentially launching as early as the fourth quarter.

The bank believes the launch of the WeChat AI agent will support a potential valuation reassessment for Tencent, expecting a clear re-rating path over the next 9 to 18 months as the AI agent is implemented.

Strong Buying in Fiber Optic Stocks

Yangtze Optical Fibre and Cable Joint Stock Ltd (06869) saw net purchases of HK$1.056 billion.

This follows Amazon's signing of a multi-billion dollar agreement with Corning to purchase optical fibers, cables, and connectivity solutions to support its US data center expansion.

Additionally, the CEO of Japanese fiber optic cable manufacturer Fujikura noted that some customers have agreed to pay higher prices for the company's premium products.

Data shows that Yangtze Optical Fibre's overseas business revenue reached approximately RMB 6.092 billion, a year-on-year increase of about 47.8%, further growing its share of total operating revenue to a record high of 42.7%.

Continued Accumulation in PCB Sector Stocks

Northbound funds continued to add to holdings in the Kingboard group, with net purchases of HK$573 million for Kingboard Holdings Ltd (00148) and HK$405 million for Kingboard Laminates Holdings Ltd (01888).

Shenwan Hongyuan Group released a research report stating that while the market views the price hikes in copper-clad laminate (CCL) as merely a pass-through of improved downstream demand and rising raw material costs, the bank believes a more profound trend is evident.

The report highlights a clear shift towards customization, specialization, and premiumization in CCL, which is expected to drive a reshaping of the industry's position within the supply chain.

The improving structure of the CCL industry is set to become more apparent and is anticipated to lead to sustained margin expansion for CCL manufacturers.

As the world's largest CCL enterprise, Kingboard Laminates is positioned to benefit continuously from this trend.

Notable Outflows from Energy and Tech Giants

CNOOC Ltd (00883) experienced net outflows of HK$195 million.

This follows Saudi Aramco's significant reduction of the official selling price for its Arab Light crude oil loaded in July for Asia, cutting the premium by $6 per barrel from $15.50 to $9.50.

Furthermore, Goldman Sachs estimates that the approximately $15-$20 per barrel rise in WTI crude oil includes a geopolitical risk premium, which is expected to dissipate quickly if ceasefire negotiations show positive signs.

Alibaba Group Holding Ltd (09988) faced substantial net outflows of HK$2.371 billion.

The US Department of Defense has added Alibaba Group to its list of Chinese military companies.

Alibaba stated that it believes its inclusion on this list is a mistake, made without any basis, and reiterated that the company is not a Chinese military enterprise and does not participate in any military-civil fusion strategy.

The company affirmed it will take all feasible legal action against any attempts to misrepresent its image.

In other trading activity, Xiaomi Corporation (01810) received net inflows of HK$429 million, while Hua Hong Semiconductor Ltd (01347) and Semiconductor Manufacturing International Corporation (00981) saw net outflows of HK$57.64 million and HK$96.27 million, respectively.