Signs of china's economic recovery? Introducing the top 10 chinese stocks and rapidly rising china-related stocks to watch.

Major financial regulatory institutions in China gathered and announced large-scale policies. On September 24th (Thursday), the economic situation was analyzed at a meeting of the Chinese Political Bureau, and strong fiscal and monetary support was announced. As a result of this series of actions, the optimism of domestic and foreign investors in the Chinese stock market has increased, leading to a historic turnaround in Chinese stocks.

Of particular note is the resilience of the Hong Kong stock market. The Hang Seng Technology Index surged by over 20% in one week, while the Hang Seng Index rose by 13%. The year-to-date increase of the Hang Seng Index has reached 21%, slightly surpassing the S&P 500's 20.45% year-to-date increase and coming close to the Nasdaq's 21.18% increase.

Understanding the Chinese stock market and the Hong Kong stock market

Major stock price indices: CSI 300 Index, Shanghai Composite Index, Shenzhen Component Index, etc.

Trading hours:

• Morning session: 9:30 - 11:30

• Afternoon session: 13:00 - 15:00

• Note: The trading hours in the Chinese market are in China Standard Time (CST).

Major stock price indexes: Hang Seng Index, Hang Seng Tech Index, etc.

Trading Hours:

• Morning Session: 9:30 - 12:00

• Afternoon Session: 13:00 - 16:00

• Note: The trading hours in the Hong Kong market are also in Hong Kong Standard Time (HKT).

Various policy introductions have led to bullish attitudes from domestic and foreign investment institutions towards Chinese assets. In the Chinese market, the fear of missing out on the upward opportunities is spreading, and the market sentiment is beginning to change. The combination of FRB rate cuts and domestic Chinese policies has created a synergistic effect, boosting market confidence and promoting inflow of funds into the Hong Kong market. Despite recent valuation adjustments, the indicators in the Hong Kong market still remain at historically low levels. Now, let's introduce promising Chinese stocks to watch and Chinese-related stocks that have been sharply rising in September.

2 selected china connect stocks to watch

①BYD

BYD, a multinational company in china, specializes in electric vehicles (EVs) and renewable energy technology. It is listed on the hong kong index with the stock code "01211".

Company overview

• Established: 1995

• Headquarters: Shenzhen, Guangdong province, China

• Business Fields: Automobiles (especially electric vehicles), renewable energy (photovoltaic technology, energy storage), electronic equipment manufacturing

• Main Businesses

1. Electric Vehicles (EV):

1. A leading EV manufacturer in the world, providing a wide range of lineup including passenger vehicles, commercial vehicles, buses, etc.

2. Strength in proprietary battery technology development

2. Renewable Energy:

1. Developing photovoltaic systems and energy storage systems

2. Aim for a sustainable society through the provision of clean energy solutions

3. Electronic equipment:

1. Engaged in the manufacturing of mobile devices and components, and also operates as an OEM partner for electronic products.

• Growth and Outlook

BYD focuses on environmental protection and sustainable development as the core of its business philosophy, continuing to grow in line with the expansion of the global EV market. With government support policies and strengthening of international environmental regulations as tailwinds, BYD is expected to continue growing in the future.

BYD continues its technological innovation and expands its influence in markets worldwide, particularly leveraging its technological and product strengths in response to the increasing demand for electric vehicles to further expand its market share.

②Tencent

Tencent is a leading technology company in China, providing various Internet-related services, listed on the HKEX with a stock code of "00700".

• Company Overview

• Established: 1998

• Headquarters: Shenzhen, Guangdong Province, China

• Business Segments: Social Media, Digital Content, Online Advertising, Fintech, Cloud Computing, Gaming

• Main Business

1. Social Media and Messaging:

1. "WeChat" and "QQ" are extremely popular messaging apps in China, utilized as multifunctional platforms.

2. Online Gaming:

1. One of the world's largest online gaming companies, develops and operates numerous popular games.

2. They have successful titles like "League of Legends" and "PUBG Mobile" globally.

3. Digital content and streaming:

1. Provides music streaming service "QQ Music" and video streaming service "Tencent Video".

2. Delivers a variety of content such as movies, dramas, and variety shows.

4. Fintech and cloud services:

1. Supports e-commerce through mobile payment services such as "WeChat Pay" and "QQ Wallet".

2. Expanding cloud computing services and offering solutions for businesses.

• Growth and Outlook

Tencent is enhancing its presence not only in China but also in the international market. Particularly, its growth in the gaming business, digital content, and fintech sectors is remarkable. Through technological innovation and a diversified business strategy, the company is expected to continue to grow in the future.

【September Price Increase Ranking】Top 10 Chinese-related stocks with a sharp increase

1st place: NIO

Electric vehicle (EV) manufacturer in China. They produce high-performance electric SUVs and sedans, as well as providing services such as battery replacement.

Increase rate: 65.3%

2nd: BILI

Chinese online entertainment platform operating video sharing sites. Anime, gaming, live streaming, and more are popular.

Increase rate: 62.6%

3rd: XPEV

Electric vehicle manufacturer. They manufacture SUVs and sedans utilizing smart car technology, and focus on technological innovation.

Increase rate: 59.2%

4位：FUTU

オンライン証券取引プラットフォームを提供する企業。個人投資家向けに株式、ETF、オプション取引をサポートしています。

値上がり率：50.4%

5位：JD

中国最大級のオンライン小売企業。電子商取引プラットフォームを運営し、物流インフラも強化中です。

値上がり率：48.1%

6位：PDD

ソーシャルコマースプラットフォーム。共同購入モデルを採用し、低価格商品を提供することで急成長しています。

Increase rate: 40.2%

7th place: BZ

Operates the job information platform 'BOSS direct recruitment'. Connecting companies and job seekers through AI-based matching.

Increase rate: 39.3%

8th place: LI

An electric vehicle manufacturer, known for especially SUVs equipped with range extender technology.

Increase rate: 31.8%

9th place: BABA

1. The world's largest e-commerce company. Operates online marketplaces such as 'Taobao' and 'Tmall'.

Price increase rate: 27.3%

10th: YMM

A logistics platform in China. Provides an online service connecting truck drivers and cargo owners.

Price increase rate: 24.2%

In summary, the resilience of Hong Kong stocks is attributed to the following three factors:

1. Sensitivity to overseas liquidity: The Hong Kong dollar is pegged to the US dollar, so the interest rate cuts by the Federal Reserve directly impact the Hong Kong market.

2. Role as the first destination for overseas funds: Hong Kong stocks are the "first destination" for allocating Chinese assets to overseas funds, and changes in policy expectations have increased the risk appetite and investment willingness of overseas investors.

3. Long-term undervaluation: Compared to major overseas stock indices, the Hong Kong market is undervalued, providing room for future rebounds.

Areas of investor focus include sectors sensitive to interest rate declines such as the Internet, new energy vehicles, technology, biopharmaceuticals, and high dividend stocks.

※ A system that maintains a fixed exchange rate between its own currency and specific currencies such as the US dollar.

The focus areas for future Chinese stocks (Hong Kong stocks) investment

Two particular areas to pay attention to in future Chinese stocks (Hong Kong stocks) investments are as follows.

① Growth sectors sensitive to interest rate declines: Sectors with potential for long-term investments include the Internet, new energy vehicles, technology hardware, biopharmaceuticals, and more.

High dividend stocks that can be expected to provide reliable shareholder returns.

Even with a slightly weaker economic situation in China in 2024, the internet sector may continue to perform well for the following reasons:

• Stable regulatory environment and limited policy risks.

• Enhanced cash flow due to stabilized competition.

• Low valuation, improving ROE, and stable revenue outlook.

• Undervaluation by overseas investors.

In the digital economy sector, especially in technology and the internet, further growth is expected due to digitalization and technological innovation. The FRB rate cut has a positive impact on the Hong Kong market, particularly attracting attention from the perspective of state-owned enterprises' dividend potential.

Several sectors are rising simultaneously. Which sector is experiencing the most significant increase?

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