Trading data from the Hong Kong stock market on July 29 shows that northbound funds recorded a net sell-off of HK$5.589 billion. The Shanghai-Hong Kong Stock Connect saw a net sell of HK$4.093 billion, while the Shenzhen-Hong Kong Stock Connect recorded a net sell of HK$1.496 billion.

The stocks with the highest net buying from northbound funds were Alibaba-W (HK:09988), Tencent (HK:00700), and Z.AI (HK:02513). In contrast, the stocks with the most significant net selling were SMIC (HK:00981), YOFC (HK:06869), and KB LAMINATES (HK:01888).

Active stocks on the Shanghai-Hong Kong Stock Connect

Active stocks on the Shenzhen-Hong Kong Stock Connect

Alibaba-W (HK:09988) attracted a net purchase of HK$1.325 billion. The company recently released Qwen 3.8-Max-Preview, a sparse mixture-of-experts AI model with 2.4 trillion parameters. According to user feedback, Qwen 3.8 demonstrates clear advantages in model capability, reasoning efficiency, and deployment cost, with significant improvements in complex reasoning, code generation, long-text processing, and AI agent applications. Haitong International believes that Qwen 3.8 represents a crucial step for Alibaba in demonstrating its strength amid recent model iterations, while also reducing forecasts for losses in its food delivery business and raising margin predictions for its cloud business.

Tencent (HK:00700) saw a net purchase of HK$831 million. Guolian Minsheng Securities noted that on July 23, Tencent restructured its Hunyuan team, merging the large language model and multimodal model departments to form a new basic model unit, all under the management of Chief AI Scientist Yao Shunyu. The firm suggests monitoring further developments in multimodal models. They believe that while core business growth is slowing, it still shows resilience, and the pace of AI product and base model updates has noticeably accelerated in the near term. Given its unique ecosystem advantages in a landscape of increasingly homogenous large models, Tencent offers attractive valuation prospects.

Z.AI (HK:02513) received a net purchase of HK$491 million. Recently, Hugging Face disclosed a cybersecurity incident initiated by an autonomous AI agent. During the investigation, the security team chose to deploy the open-source model GLM-5.2 locally for forensic analysis, rather than using a commercial model API. On the evening of July 23, Z.AI posted on its official Weibo account, stating that this incident has further confirmed the value of open-sourcing GLM 5.2.

HUA HONG GRACE (HK:01347) and SMIC (HK:00981) experienced net selling of HK$88.95 million and HK$2.007 billion, respectively. The technology sector continued its pullback. Some analysts suggest that the direct trigger for this sell-off is the market's waning patience with the potential returns on massive AI capital expenditures by tech giants. Meanwhile, the "circular financing" model for Nvidia's over US$750 billion AI infrastructure exchange has faced scrutiny from credit markets. This coincides with a re-evaluation of competitive dynamics due to the upcoming IPO of Chinese DRAM leader CXMT.

YOFC (HK:06869) saw a net sell of HK$280 million. Shares of US specialty glass and fiber optic manufacturer Corning fell over 20% after its Q2 earnings report. While revenue grew 17% and profit 30% for the quarter, with optical communications revenue up 32% year-on-year, its Q3 core sales guidance of US$4.9-5.0 billion was only in line with expectations at the upper end. The implied sequential growth rate dropped sharply from 9% to 3-6%. Furthermore, several companies in the industry chain have started expanding production capacity for optical preforms and specialty fibers this year, with some even entering the sector from other industries.

Additionally, GIGADEVICE (HK:03986) attracted a net purchase of HK$351 million, while KB LAMINATES (HK:01888) recorded a net sell of HK$171 million.