After several major US cloud service providers raised AI capital expenditure following their earnings releases last week, Hong Kong equities advanced today, driven by technology, internet and AI-related supply chain stocks. Reports said Iran has submitted a new proposal for negotiations with the US, raising hopes of a fresh round of talks between the two sides. US President Donald Trump said he had launched an operation named "Freedom Plan", under which the US would guide vessels stranded in the Strait of Hormuz to depart, while Iran's armed forces warned that US forces approaching the Strait of Hormuz would face attacks. At the time of writing, the US two-year Treasury yield stood at 3.888%, while the US 10-year Treasury yield rose to 4.398%. The US Dollar Index climbed to 98.23. DJIA futures last fell 101 points or 0.2%, while Nasdaq futures last rose 59 points or 0.2%. A-shares were closed for the "Labour Day" holiday from today (May 4) to tomorrow (May 5) and will resume trading on Wednesday (6th).

The HSI opened 361 points higher and extended gains, once peaking at 26,326, up 549 points at one point. It closed at 26,095, up 319 points or 1.2%. The HSCEI closed at 8,774, up 92 points or 1.1%. The HSTECH once rose more than 3% and reclaimed the 5,000 level, closing at 4,976, up 105 points or 2.2%. Total market turnover for the day amounted to HKD176.979 billion. Southbound trading will resume on Wednesday (6th). TRACKER FUND (02800.HK)  +0.040 (+0.151%)    Short selling $1.93B; Ratio 15.683%   rose 1.3% to HKD26.24, while POP MART (09992.HK)  -2.000 (-1.228%)    Short selling $1.18B; Ratio 22.570%   bucked the market to fall nearly 1% to HKD155.7.

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BABA-W in Demand; AI Stocks Strengthen

Technology and AI-related shares performed well. TENCENT (00700.HK)  +5.400 (+1.181%)    Short selling $1.73B; Ratio 14.111%   rose 1.1% to HKD473. BABA-W (09988.HK)  -0.500 (-0.375%)    Short selling $1.31B; Ratio 11.090%   climbed 4.5% to HKD131.7. MEITUAN-W (03690.HK)  +3.450 (+4.100%)    Short selling $736.65M; Ratio 13.348%   gained 1.4%. SMIC (00981.HK)  -2.450 (-3.198%)    Short selling $627.88M; Ratio 9.764%   rose 1.8%, HUA HONG SEMI (01347.HK)  +0.300 (+0.232%)    Short selling $506.87M; Ratio 13.563%   surged 6%, and ILUVATAR COREX (09903.HK)  +3.500 (+0.673%)    Short selling $54.06M; Ratio 10.608%   soared 20%. AI names MINIMAX-W (00100.HK)  +127.500 (+18.465%)    Short selling $43.95M; Ratio 2.207%   and MANYCORE TECH (00068.HK)  -0.520 (-2.291%)   jumped nearly 13% and 19%, respectively. KNOWLEDGE ATLAS (02513.HK)  +310.000 (+36.905%)    Short selling $35.61M; Ratio 1.000%   rebounded 10%, while XUNCE (03317.HK)  +54.600 (+23.885%)   gained 9.3%. In addition, KB LAMINATES (01888.HK)  +2.480 (+5.576%)    Short selling $269.74M; Ratio 16.717%   advanced 7.4%, and Changfei Guangxian Guanglan (006869.HK) leapt 12.5%.

According to mainland media reports citing OpenRouter's latest data estimates, total global calls to large AI models reached 23.9 trillion tokens last week (April 27 to May 3), up 8.6% WoW and marking the second consecutive weekly increase. Among the listed models, weekly calls for Chinese AI large models rose to 7.942 trillion tokens, up 81.7% WoW, while US AI large models recorded 3.258 trillion tokens, down 34.6% WoW. After two weeks, Chinese AI large models once again surpassed their US counterparts in weekly calls. Among the global top three by call volume last week, the top two were Chinese AI large models. TENCENT's Hy3 preview (free) ranked first with 3.03 trillion tokens, surging 799% WoW. Kimi K2.6 ranked second, up 15% WoW. MiniMax M2.7 under MINIMAX-W (00100.HK)  +127.500 (+18.465%)    Short selling $43.95M; Ratio 2.207%   ranked eighth with 0.729 trillion tokens, down 8% WoW. DeepSeek-V4-Flash entered the rankings for the first time at ninth place with 0.704 trillion tokens, up 344% WoW.

Related NewsInflation Rate YoY for Apr in China is 1.2%, higher than the previous value of 1.0%. The forecast was 0.8%.
1,300 Stocks Rise; Support for XIAOMI-W

Market breadth improved, with the ratio of advancers to decliners on the Main Board at 33 to 18. A total of 1,394 stocks rose (3.6%). Among HSI constituents, 71 stocks advanced while 19 declined, representing a ratio of 79 to 21. Short selling turnover reached HKD32.211 billion, accounting for 21.5% of eligible securities turnover of HKD149.813 billion (previous day: 19.06%).

XIAOMI-W (01810.HK)  +0.340 (+1.081%)    Short selling $504.37M; Ratio 15.585%   jumped 6.8% to HKD30.98, making it the best-performing blue chip. BOCI said in a report that it expects XIAOMI-W's 1Q26 total revenue to decline about 14% QoQ to RMB100 billion, mainly dragged by a more than 40% drop in vehicle deliveries. In contrast, its core business segments showed resilience, with smartphone and IoT revenue expected to remain broadly flat QoQ, while internet services revenue may edge down slightly QoQ. On margins, the broker expects the core business to outperform pessimistic market expectations, with smartphone gross margin likely rebounding to above 9.5% and IoT margin returning to the peak level of 25%. At the group level, adjusted net profit is forecast at RMB5.5 billion, above market expectations.

Related NewsPPI YoY for Apr in China is 2.8%, higher than the previous value of 0.5%. The forecast was 1.5%.
Macau gaming stocks weakened. Yinyu (000027.HK) fell 2.8% to HKD32.22. SANDS CHINA LTD (01928.HK)  -0.110 (-0.682%)    Short selling $23.82M; Ratio 14.749%   slipped 2.3%, while MGM CHINA (02282.HK)  -0.020 (-0.180%)    Short selling $31.40M; Ratio 47.692%   and MELCO INT'L DEV (00200.HK)  +0.030 (+0.775%)    Short selling $1.25M; Ratio 9.269%   each dropped more than 3%. Citi said Macau's April GGR reached MOP19.894 billion (about MOP663 million per day), up 5% YoY and recovering to about 84% of the April 2019 level, slightly below its forecast of MOP20 billion and market consensus of MOP20.1 billion. Looking ahead to May, Macau will kick off with a series of concerts. Given one additional weekend day compared with the same month last year, Citi conservatively forecasts May GGR at MOP23 billion (about MOP742 million per day), implying 9% YoY growth.

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