The Hong Kong market saw a decline in the morning session, with the Hang Seng Index dropping 0.98%, or 234 points, to reach 23,690 points. The Hang Seng Tech Index fell by 1.35%. Morning turnover on the Hong Kong market was HKD 200.3 billion.

Knowledge Atlas (HKEX: 02513) saw its shares surge by more than 40% at one point during the session, hitting a new record high and pushing its market capitalization above HKD 1 trillion, driven by its CEO's positive outlook on the pace of Chinese AI model development. By midday, the stock was up over 17%.

YOFC (HKEX: 06869) shares jumped more than 27% after optical fiber supplier Fujikura raised its performance guidance, suggesting that price increases for optical fiber may become an industry-wide trend. Attention is also on price hikes for PCBs.

KINGBOARD HLDG (HKEX: 00148) rose over 8%, reaching another all-time high since its listing, with year-to-date gains approaching 400%.

Key Market Movers in the Morning

Chinese brokerage stocks moved higher just before the midday break. The Lujiazui Forum released several policy benefits, and brokerages' interim reports are expected to maintain strong performance. GF SEC (HKEX: 01776) gained 6.49%, while CITIC SEC (HKEX: 06030) advanced 6.4%.

New listing HQVT (HKEX: 01392) debuted strongly, surging 250% in the morning session. The company holds the top market share in China's multispectral AI industry.

GIGADEVICE (HKEX: 03986) climbed 11% to another record high, as robust demand and supplier exits are expected to drive growth in NOR/NAND flash memory.

LOPAL TECH (HKEX: 02465) gained over 11%, with demand for lithium iron phosphate remaining strong even as prices have doubled.

The rare metal material bismuth telluride attracted market attention. Shares of DONGJIANG ENV (HKEX: 00895) surged 37% in Hong Kong.

COSCO SHIP ENGY (HKEX: 01138) rose 7.9% on expectations of restored shipping lanes following US-Iran talks and a significant increase in spot freight rates on major routes.

Notable Decliners

Automotive stocks were broadly lower, with many falling more than 4%, following the EU's plan to impose additional tariffs on imported Chinese plug-in hybrid vehicles. GWMOTOR (HKEX: 02333) fell over 3%, and LI AUTO-W (HKEX: 02015) declined 3%.

Gold stocks were among the worst performers. With the Federal Reserve unlikely to cut rates this year, Goldman Sachs significantly lowered its gold price target. LINGBAO GOLD (HKEX: 03330) dropped 10%, and CHIFENG GOLD (HKEX: 06693) fell 6.47%.