[ET Net News Agency, 24 August 2026] Alibaba (09988) plans to place 710 million new shares at HKD 112.7 per share, representing a discount of approximately 8.37% to the company's closing price last Friday of HKD 123, with net proceeds reaching HKD 79.7 billion. This placement is not only Alibaba's first secondary share issuance since its listing in Hong Kong in 2019, but it also sets a record for the largest new share placement in the history of the Hong Kong securities market. Alibaba's historic share placement caused its share price to plunge by 9.76% by midday to report at HKD 111, dragging down the HSI by nearly 200 points. The HSI closed the morning session at 25,465, down 544 points or 2.1%, falling through the 250-day moving average (approximately 25,756), the 20-day moving average (approximately 25,648), and the 10-day moving average (approximately 25,519), with Main Board turnover exceeding HKD 167.9 billion. The Hang Seng China Enterprises Index reported 8,460, down 173 points or 2%. The Hang Seng TECH Index reported 4,582, down 183 points or 3.8%.
"Mak Ka Ka: US bond yields still have a greater impact on Hong Kong stocks"
Alibaba's share placement news dragged down a slew of tech stocks. Tencent (00700) fell 3.8% at midday to report at HKD 439.8; Xiaomi (01810) fell 4.1% at midday to report at HKD 27.84; Baidu (09888) fell 4.1% at midday to report at HKD 89.4. Mak Ka Ka, Head of Financial Products Trading and Research Department of SinoPac Securities (Asia), told ET Net News Agency that the total amount of this share placement is too large, once again triggering market concerns over tech stocks' capital expenditure. She explained that the total size of the placement reflects Alibaba's capital expenditure needs to introduce long-term capital to match its long-term AI projects, making it difficult to raise funds solely through debt issuance. Meanwhile, the market currently holds a heavier guard against companies with high capital expenditures, and the market worries that Alibaba's future profit model and equity structure will be affected. Additionally, Mak Ka Ka noted that Alibaba's earlier share price gains were relatively large, and this share placement simultaneously triggered funds to lock in profits at high levels, combining to cause a sharp pullback in Alibaba's share price.
However, Mak Ka Ka pointed out that the negative impact brought by the share placement is expected to be short-term only. Furthermore, although tech stocks collectively pulled back today, since the enterprises within the market are currently more differentiated, the subsequent market may not trigger a stampede of selling tech stocks. Compared to Alibaba's share placement news, Mak Ka Ka believes that US Treasury yields have a greater impact on Hong Kong stocks. Mak Ka Ka mentioned that after the US Treasury Department announced the buyback of US long-term government bonds last week, long-term bond yields briefly pulled back before rising again, reflecting that US authorities lack the ability to suppress long-term bond yields, and the market holds greater guard against this. Coupled with multiple major news items this week, such as US PCE inflation data, Nvidia's earnings, and Warsh's appearance at the Jackson Hole Symposium, market wait-and-see sentiment is strong, leaning towards increasing cash holdings and reducing risk asset allocation, leading to a relatively large pullback in Hong Kong stocks today.
Mak Ka Ka stated that the HSI currently lacks momentum and previously failed to firmly hold the 26,000 mark. Coupled with a more cautious attitude from funds, it is expected that the HSI will more easily re-test the lower region, and it is anticipated to maintain range-bound fluctuations between 25,000 and 26,000 points in the near term.
"Li Ning's gross profit margin may be further eroded"
Li Ning (02331) previously announced its interim results for the period ended 30 June, with interim profit of approximately RMB 1.82 billion, up 4.5%. Earnings per share were RMB 0.704, and an interim dividend of RMB 0.3512 per share was declared, up about 4.6%. Zhao Dongsheng, Vice President and Chief Financial Officer of Li Ning, pointed out at the earnings conference that the full-year revenue growth target has been adjusted to low single digits, and stated that the challenges of strong supply and weak demand will continue in the second half of the year, with terminal performance continuing to fall below expectations. Affected by Li Ning's downward revision of its sales expectations, today's performance turned weak, falling 5.2% at midday to report at HKD 13.51.
Mak Ka Ka expressed that although Li Ning's dividend payout has increased significantly, the company is not a traditional dividend stock, and the market is paying more attention to its second-half demand, depreciation, marketing input, and gross profit margin pressure. Management currently acknowledging that retail terminal performance is weaker than expected indicates that the actual situation may be even weaker than originally anticipated, and the view on this stock should remain prudent.
Mak Ka Ka pointed out that Li Ning is currently facing issues such as intensified industry competition and deeper promotional discounts, which continue to erode its gross profit margin and drive up inventory and provisioning risks. Under the blow to fundamentals, subsequent share prices still face adjustment pressure, and a re-test of the low of around HKD 12.6 seen in April last year cannot be ruled out in the short term. She reminded investors to strictly avoid blindly buying the dip, and noted that subsequent indicators such as retail sell-through, same-store performance, discount depth, and advertising-to-sales ratios still need to be closely monitored. At this stage, the investment positioning for Li Ning should be "waiting quietly for recovery signals to emerge."
"Mak Ka Ka: US bond yields still have a greater impact on Hong Kong stocks"
Alibaba's share placement news dragged down a slew of tech stocks. Tencent (00700) fell 3.8% at midday to report at HKD 439.8; Xiaomi (01810) fell 4.1% at midday to report at HKD 27.84; Baidu (09888) fell 4.1% at midday to report at HKD 89.4. Mak Ka Ka, Head of Financial Products Trading and Research Department of SinoPac Securities (Asia), told ET Net News Agency that the total amount of this share placement is too large, once again triggering market concerns over tech stocks' capital expenditure. She explained that the total size of the placement reflects Alibaba's capital expenditure needs to introduce long-term capital to match its long-term AI projects, making it difficult to raise funds solely through debt issuance. Meanwhile, the market currently holds a heavier guard against companies with high capital expenditures, and the market worries that Alibaba's future profit model and equity structure will be affected. Additionally, Mak Ka Ka noted that Alibaba's earlier share price gains were relatively large, and this share placement simultaneously triggered funds to lock in profits at high levels, combining to cause a sharp pullback in Alibaba's share price.
However, Mak Ka Ka pointed out that the negative impact brought by the share placement is expected to be short-term only. Furthermore, although tech stocks collectively pulled back today, since the enterprises within the market are currently more differentiated, the subsequent market may not trigger a stampede of selling tech stocks. Compared to Alibaba's share placement news, Mak Ka Ka believes that US Treasury yields have a greater impact on Hong Kong stocks. Mak Ka Ka mentioned that after the US Treasury Department announced the buyback of US long-term government bonds last week, long-term bond yields briefly pulled back before rising again, reflecting that US authorities lack the ability to suppress long-term bond yields, and the market holds greater guard against this. Coupled with multiple major news items this week, such as US PCE inflation data, Nvidia's earnings, and Warsh's appearance at the Jackson Hole Symposium, market wait-and-see sentiment is strong, leaning towards increasing cash holdings and reducing risk asset allocation, leading to a relatively large pullback in Hong Kong stocks today.
Mak Ka Ka stated that the HSI currently lacks momentum and previously failed to firmly hold the 26,000 mark. Coupled with a more cautious attitude from funds, it is expected that the HSI will more easily re-test the lower region, and it is anticipated to maintain range-bound fluctuations between 25,000 and 26,000 points in the near term.
"Li Ning's gross profit margin may be further eroded"
Li Ning (02331) previously announced its interim results for the period ended 30 June, with interim profit of approximately RMB 1.82 billion, up 4.5%. Earnings per share were RMB 0.704, and an interim dividend of RMB 0.3512 per share was declared, up about 4.6%. Zhao Dongsheng, Vice President and Chief Financial Officer of Li Ning, pointed out at the earnings conference that the full-year revenue growth target has been adjusted to low single digits, and stated that the challenges of strong supply and weak demand will continue in the second half of the year, with terminal performance continuing to fall below expectations. Affected by Li Ning's downward revision of its sales expectations, today's performance turned weak, falling 5.2% at midday to report at HKD 13.51.
Mak Ka Ka expressed that although Li Ning's dividend payout has increased significantly, the company is not a traditional dividend stock, and the market is paying more attention to its second-half demand, depreciation, marketing input, and gross profit margin pressure. Management currently acknowledging that retail terminal performance is weaker than expected indicates that the actual situation may be even weaker than originally anticipated, and the view on this stock should remain prudent.
Mak Ka Ka pointed out that Li Ning is currently facing issues such as intensified industry competition and deeper promotional discounts, which continue to erode its gross profit margin and drive up inventory and provisioning risks. Under the blow to fundamentals, subsequent share prices still face adjustment pressure, and a re-test of the low of around HKD 12.6 seen in April last year cannot be ruled out in the short term. She reminded investors to strictly avoid blindly buying the dip, and noted that subsequent indicators such as retail sell-through, same-store performance, discount depth, and advertising-to-sales ratios still need to be closely monitored. At this stage, the investment positioning for Li Ning should be "waiting quietly for recovery signals to emerge."
