Country Daily
China Economics PMI/China Healthcare Bi-weekly/Macau Gaming/Kuaishou
Analyst
Analyst
Top Stories
Economics | PMI
June's PMI was overall modestly positive. Manufacturing PMI held at 50.3 (+0.3pt mom) and non-manufacturing PMI stayed in the expansion zone at 50.2 (+0.1pt mom) despite continued weakness in the construction industry, both beating Bloomberg's consensus. Manufacturing new export orders index returned to expansion at 50.1 while input cost pressures eased, giving manufacturers margin relief after months of compression. The composite index for medium-sized enterprises rebounded into expansion, while that for small firms still lagged. The recovery is firmer but uneven; continued targeted policy support remains warranted.
Sector Update | Healthcare
During 12-30 Jun 26, the HSHCI gained 0.9% vs the HSI’s significant decline of 7.4%. Leading drug innovators such as WuXi AppTec, WuXi Bio, and BeOne Medicines were among the major outperformers. China’s supportive policies for innovation, ie the newly-released National Health 15th Five-year Plan, 2026 NRDL, and commercial insurance policy, were the key catalysts behind the relatively strong performance of the HSHCI. Maintain MARKET WEIGHT.
Sector Update | Macau Gaming
Macau’s Jun 26 GGR reached MOP18.5b, down 12% yoy and 18% mom, due to the ongoing World Cup. June’s GGR figure recovered to 78% of 2019’s level, and missed market consensus by 1%. For 1H26, Macau’s GGR reached MOP126.9b, up 7% yoy and recovering to 85% of 2019’s level. This run-rate fell short of our full-year estimates. Maintain OVERWEIGHT; Galaxy remains our top pick.
Company Update | Kuaishou (1024 HK/BUY/HK$41.60/Target: HK$82.00)
Despite positive news regarding Kling AI's potential spin-off and accelerating commercialisation, Kuaishou's shares have remained under pressure, reflecting weak sentiment towards China internet stocks and softer 2Q26 advertising and e-commerce trends. Our 2026 earnings forecasts are largely unchanged. Kling AI’s ARR is expected to reach around US$1.0b by 4Q26 vs US$100m in 1Q25, while elevated AI capex and R&D spending are likely to continue weighing on near-term earnings and free cash flow. Maintain BUY with a target price of HK$82.00.
Technical Analysis
Shanghai Iluvatar CoreX | 9903 HK
Support levels: HK$656.00/HK$614.00
Resistance levels: HK$887.50/HK$1050.00
Techtronic Industries | 669 HK
Support levels: HK$125.60/HK$121.30
Resistance levels: HK$147.00/HK$156.80
Top Stories
Economics | PMI
June's PMI was overall modestly positive. Manufacturing PMI held at 50.3 (+0.3pt mom) and non-manufacturing PMI stayed in the expansion zone at 50.2 (+0.1pt mom) despite continued weakness in the construction industry, both beating Bloomberg's consensus. Manufacturing new export orders index returned to expansion at 50.1 while input cost pressures eased, giving manufacturers margin relief after months of compression. The composite index for medium-sized enterprises rebounded into expansion, while that for small firms still lagged. The recovery is firmer but uneven; continued targeted policy support remains warranted.
Sector Update | Healthcare
During 12-30 Jun 26, the HSHCI gained 0.9% vs the HSI’s significant decline of 7.4%. Leading drug innovators such as WuXi AppTec, WuXi Bio, and BeOne Medicines were among the major outperformers. China’s supportive policies for innovation, ie the newly-released National Health 15th Five-year Plan, 2026 NRDL, and commercial insurance policy, were the key catalysts behind the relatively strong performance of the HSHCI. Maintain MARKET WEIGHT.
Sector Update | Macau Gaming
Macau’s Jun 26 GGR reached MOP18.5b, down 12% yoy and 18% mom, due to the ongoing World Cup. June’s GGR figure recovered to 78% of 2019’s level, and missed market consensus by 1%. For 1H26, Macau’s GGR reached MOP126.9b, up 7% yoy and recovering to 85% of 2019’s level. This run-rate fell short of our full-year estimates. Maintain OVERWEIGHT; Galaxy remains our top pick.
Company Update | Kuaishou (1024 HK/BUY/HK$41.60/Target: HK$82.00)
Despite positive news regarding Kling AI's potential spin-off and accelerating commercialisation, Kuaishou's shares have remained under pressure, reflecting weak sentiment towards China internet stocks and softer 2Q26 advertising and e-commerce trends. Our 2026 earnings forecasts are largely unchanged. Kling AI’s ARR is expected to reach around US$1.0b by 4Q26 vs US$100m in 1Q25, while elevated AI capex and R&D spending are likely to continue weighing on near-term earnings and free cash flow. Maintain BUY with a target price of HK$82.00.
Technical Analysis
Shanghai Iluvatar CoreX | 9903 HK
Support levels: HK$656.00/HK$614.00
Resistance levels: HK$887.50/HK$1050.00
Techtronic Industries | 669 HK
Support levels: HK$125.60/HK$121.30
Resistance levels: HK$147.00/HK$156.80
Analyst
Analyst
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