[ET Net News Agency, 15 November 2024] The increase in U.S. producer prices accelerated
in October. Federal Reserve Chairman Powell said that the U.S. economy is strong and the
authorities should not rush to cut interest rates. The three major U.S. stock indexes
turned from rising to falling. After falling for five consecutive days, the Hang Seng
Index opened dozens of points higher this morning. However, the decline in A-shares once
dragged the Hang Seng Index down more than a hundred points. The National Bureau of
Statistics announced that the total retail sales of consumer goods in October was RMB 4.54
trillion, a year-on-year increase of 4.8%, higher than market expectations of a 3.8%
increase, and the growth rate was 1.6 percentage points faster than in September. The data
stimulated a rebound in domestic demand-related stock prices.
The Hang Seng Index closed at 19,486 at half-time, up 51 points or 0.3%, with main board
turnover of nearly HKD 85.2 billion. The Hang Seng China Enterprises Index was at 7,001,
up 27 points or 0.4%. The Hang Seng Tech Index reported at 4,357, up 38 points or 0.9%.

"Fund tends to be conservative, and the results of technology companies have failed to
drive market entry"

Hong Kong stocks opened 67 points higher in a narrow range this morning, falling first
and then rising, maintaining a narrow range. Yuen Che Hay, the Co-Director of Investment
Strategy of Quam Asset Securities, told ET Net News Agency that the trend of the Hang Seng
Index turned slightly better today because the Mainland China's troika data was slightly
better than expected. However, due to the recent measures taken by the Standing Committee
of the National People's Congress didn't meet market's expectations, and the market
expects that the central government will not introduce new measures in the short term, so
the Hang Seng Index is still on the soft side. He specifically pointed out that although
the recent results of Tencent (00700) and JD.com (09618) are not bad, market funds still
maintain a wait-and-see attitude, and the US stocks of Tencent and JD.com have even
fallen. He further added that the U.S. dollar has continued to strengthen recently and is
approaching its highest level. The market will further wait and see the trend of the U.S.
dollar, and funds will tend to be conservative. He expected that if the Hang Seng Index is
to rise again, new good news would need to be released. The short-term support level of
the Hang Seng Index is at the golden ratio of 0.618 (about 19,300 points). If it wants to
rise further, it must stand firmly at the resistance level of 19,800 points.

"NetEase doesn't have hit games, resting on its laurels and the results are affected"

NetEase (09999)'s third-quarter net profit fell 16.6% year-on-year to RMB 6.538 billion,
and its performance was worse than expected. However, management revealed at the
performance meeting that "Where Winds Meet" will be launched at the end of December and is
undergoing final optimization work. The stock price rose 13.4% in half a day to HKD 135.5.
Yuen Che Hay believes that NetEase's performance is average, and the stock price has
risen mainly because NetEase announced today that it will launch "Where Winds Meet" in
December. The market hopes that it can compete with "Black Myth: Wukong". However, Yuen
Che Hay said that in fact, "Where Winds Meet" and "Black Myth: Wukong" are not of the same
genre and cannot be directly compared. Instead, he is optimistic about another game
"Project Mugen". NetEase said that the number of reservations for this game has reached 5
million. Yuen Che Hay believes that this game may become the focus of NetEase.
In terms of performance, net income from games and related value-added services was RMB
20.9 billion, a year-on-year decrease of 4.2%; Youdao's net income was RMB 1.6 billion, an
increase of 2.2% year-on-year; NetEase Cloud Music's net income was RMB 2 billion, an
increase of 1.3% year-on-year; net income from innovation and other businesses was RMB 1.8
billion, a year-on-year decrease of 10.3%. Yuen Che Hay said that NetEase's performance
decline was mainly due to the fact that there were no new hit games and it was still
resting on its laurels, such as "Eggman Party". Regarding NetEase's future performance
expectations, he believes that the key is whether there will be hit games.
As for whether investors should buy NetEase before the release of new hit games, Yuen
Che Hay suggested to wait and see first and not to enter the market emotionally. Only if
NetEase can hold on to its current position (about HKD 135), investors can consider
buying, with a target of 150. If NetEase falls below HKD 130, it is not suitable for
buying.