Golden Wealth News | The Hang Seng Index will be closed all day on New Year's Day, Wednesday, the 1st. On Tuesday, the 31st, the market had only half a day, closing at 20,059, up 18 points or 0.1%. The total market turnover for the day was 74.5 billion yuan. The National Index closed up 9 points or 0.1%, at 7,289. The Tech Index underperformed today, closing down 32 points or 0.7%, at 4,468; the leading cryptocurrency Bitcoin performed outstandingly this year, with related ETFs showing significant gains, among which Samsung Bitcoin (03135) saw an increase of 93% this year; after a series of declines, the 'Blind Box stock' POP MART (09992) rebounded by 4.1% today, making POP MART the best-performing stock in the 'Hong Kong Stock Connect' this year, with an approximate increase of 3.5 times during this period.

The Dow Jones will be closed all day on New Year's Day, Wednesday, the 1st. On Tuesday, the 31st, it closed at 42,544 points, down 29 points or 0.07%; the S&P 500 fell 0.43%, closing at 5,881 points; the Nasdaq fell 0.9%, closing at 19,310 points; major stocks fluctuated slightly, with the closing stock price declines for Apple, Meta, Amazon, and Alphabet being 0.7%, 1%, 0.9%, and 1% respectively. Tesla's stock price fell 3.3%, with analysts estimating that the company delivered approximately 510,400 electric vehicles in the fourth quarter of 2024, setting a new seasonal record, but still recording the first annual decline in over a decade. Benefiting from the AI boom, the demand for electrical utilities from datacenters has surged; Vistra's stock price soared 257% in 2024, which is much sharper than Nvidia's nearly 180% rise, making it the first public stock to top the S&P annual gain list since 2001. Nvidia's stock price plummeted 2.3% on Tuesday, making it the worst-performing Dow component. Asian Pacific stock markets showed mixed performance this morning (2nd), with the Nikkei 225 Index currently at 39,894 points, down 386 points or 0.96%. The South Korean Composite Index is currently at 2,398 points, down 1 point or 0.03%. Attention can be directed to the domestic demand and electric vehicles as well as upstream related industries on the first trading day of 2025.

Market Focus: Semiconductor Manufacturing International Corporation (00981)

Thanks to the continued advancement of semiconductor localization, the industry is currently in a recovery phase, with semiconductor chip stocks continuing their recent upward trend, primarily focusing on the mainland chip leader Semiconductor Manufacturing International Corporation. Semiconductor Manufacturing International Corporation is one of the world's leading integrated circuit foundry companies and the leader in integrated circuit manufacturing in mainland China. According to the reported 2023 sales figures from global pure wafer foundries, Semiconductor Manufacturing International Corporation ranks fourth globally and first among companies in mainland China. In the third quarter of this year, the group achieved a revenue of 15.6 billion yuan, a year-on-year increase of 33%; net income attributable to shareholders was 1.1 billion yuan, a year-on-year increase of 56%; the net income after deducting non-recurring items was 0.9 billion yuan, a year-on-year increase of 32%. The domestic demand drove the new quarterly revenue high, and the significantly increased unit price led to a substantial improvement in gross margin, which rose by 6.6 percentage points to 20.5%. During the quarter, the capacity increased by 47,300 pieces to 884,000 equivalent 8-inch wafers, with a capacity utilization rate of 90.4%. The wafer ASP reached 966 dollars, a year-on-year increase of 0.5% and a quarter-on-quarter increase of 15.5%. Looking ahead, with the further warming of the industry cycle, coupled with the demand increase driven by AI, Semiconductor Manufacturing International Corporation is expected to benefit from the future growth in silicon content in low-power mobile IoT and RAM, BCD and other products. Domestic substitution is imperative, and the group, as the leader in foundry services in mainland China, will significantly benefit. Target price $36, stop-loss price $25.

(The author is a licensed person of the China Securities Regulatory Commission and does not hold any of the above stocks.)

Author: Dr. Tang Shengxing, Chairman of the Hong Kong Stock Analysts Association.