Hong Kong's three major stock indexes closed higher on Tuesday, with the market buoyed by the successful Phase III clinical trial of the world's first mRNA cancer vaccine, which ignited the vaccine sector and lifted both innovative drug and AI healthcare concepts. The Hang Seng Index advanced 0.8%, or 203.42 points, to close at 25,698.49, with total turnover reaching HK$269.119 billion. The Hang Seng China Enterprises Index rose 0.9% to 8,547.84, while the Hang Seng Tech Index gained 0.39% to 4,700.53.

According to China Industrial Securities, the core drivers of this rally in Hong Kong stocks remain low-valuation repair, capital rebalancing, and extreme sentiment reversal, rather than a broad-based recovery fueled by widespread earnings upgrades. The Hang Seng Index's forward price-to-earnings ratio has recovered from 9.7 times at the end of June to 10.5 times, returning to near its long-term average. Meanwhile, the Hang Seng Tech Index's PE has climbed to 16.1 times but still sits approximately 0.9 standard deviations below its historical mean, offering relatively higher margin of safety.

Among blue-chip stocks, SBP GROUP (01177) delivered an impressive performance following its earnings release, surging 12.53% to close at HK$5.39 with turnover of HK$2.11 billion, contributing 9.58 points to the index. Daiwa research noted that SBP GROUP's adjusted net profit (excluding dividend income) for the first half jumped 92.3% year-on-year to RMB 3.34 billion, significantly exceeding both the brokerage's and market expectations. This was primarily driven by the improvement in product sales gross margin, which rose from 84% in the same period last year to 88.6%. Additionally, after years of investment, the company's AI initiatives have substantially reduced costs and enhanced operational efficiency, with AI boosting the commercial team's promotional effectiveness by 30%.

Other blue-chip performers included CSPC Pharmaceutical Group (01093), which advanced 9.61% to HK$9.52, contributing 10.29 points to the Hang Seng Index, and ZIJIN MINING (02899), which rose 5.33% to HK$36.76, adding 16.98 points. On the downside, China Resources Beer (00291) fell 2.47% to HK$20.54, dragging the index down 1.26 points, while Semiconductor Manufacturing International Corp (00981) declined 1.23% to HK$72.10, weighing on the index by 5.78 points.

In sector performance, the successful Phase III clinical trial of the world's first mRNA cancer vaccine ignited the vaccine sector and boosted AI healthcare concepts. Multiple innovative drug companies also rallied after releasing strong earnings, with SBP GROUP and CSPC Pharmaceutical Group showing particular strength. Meanwhile, the U.S. Treasury's expansion of long-duration bond buybacks led to lower U.S. bond yields, which in turn supported gold prices, making gold and precious metals sectors standout performers. Bitcoin's approach toward the $70,000 level drove gains in cryptocurrency spot and futures ETFs. On the flip side, paper stocks led the declines, while tobacco, livestock feed, and auto dealer stocks moved higher.

Innovative drug and AI healthcare concept stocks rallied strongly. Everest Medicines (01952) soared 41.43% to HK$33.66, Genscript Biotech (01548) climbed 13.62% to HK$33.36, XtalPi Holdings-P (07666) jumped 27.99% to HK$15.00, Insilico Medicine (03696) advanced 12.13% to HK$44.20, and XtalPi Holdings (02228) rose 11.27% to HK$8.045.

Moderna and Merck announced on Wednesday that their collaborative mRNA personalized cancer vaccine, intismeran autogene, achieved preliminary positive results in its first Phase III clinical trial. China Securities believes this milestone marks the formal transition of mRNA technology from the infectious disease domain into the precision oncology treatment space. The core breakthrough lies in leveraging the mRNA platform's rapid, flexible, and multi-antigen encoding capabilities to achieve a truly personalized "one patient, one drug" cancer vaccine. Through synergy with PD-1 inhibitors, the therapy achieved nearly 50% reduction in recurrence risk in adjuvant melanoma treatment, with efficacy lasting at least five years.

Gold stocks rallied once again. Zijin Gold International (02259) advanced 11.25% to HK$148.30, Lingbao Gold (03330) gained 5.99% to HK$23.36, Shandong Gold Mining (01787) rose 5.86% to HK$25.28, and Zhaojin Mining Industry (01818) climbed 6.13% to HK$25.26. The U.S. Treasury announced it would expand its buyback program for longer-dated Treasury securities, at least doubling the size of "liquidity support buyback operations" for 10-year to 30-year maturities. Following this news, the 30-year U.S. Treasury yield fell immediately, and the U.S. dollar index moved lower in tandem. Chaos Tiancheng Futures noted that the expansion of buyback operations reflects the Treasury's desire to provide stronger liquidity support for the long-dated nominal Treasury market. While the scale of support is relatively limited, the signaling effect exceeded expectations. By issuing short-term bonds and buying back long-term bonds, the aim is to suppress long-end Treasury yields, leading to declines in both U.S. bond yields and the dollar index, while precious metals rebounded notably.

Auto stocks staged a collective recovery. Li Auto-W (02015) climbed 5.53% to HK$50.55, Voyah Automobile (07489) advanced 4.11% to HK$2.91, NIO-SW (09866) rose 4.49% to HK$36.34, and XPeng Group-W (09868) gained 4.09% to HK$47.82. On the policy front, China's Ministry of Commerce and eight other departments recently issued the "Opinions on Further Stimulating Vitality in Lower-Tier Markets and Activating County-Level Consumption," which explicitly supports new energy vehicles going to rural areas and expanding charging infrastructure coverage in rural regions. This represents another major policy implementation following the 2026 Central Document No. 1, which first included new energy vehicles as a key support area for rural revitalization. On the export side, cumulative NEV sales from January to July reached 9.007 million units, with a penetration rate of 51.2%, surpassing the 50% threshold for the first time. Central China Securities noted that July auto exports served as the core engine for the industry, with NEV penetration climbing to a new high above 60%. Combined with healthy inventory digestion, the sector is experiencing a phase of structural adjustment.

In notable individual stock movements, 3D MEDICINES (01244) surged on heavy volume, closing up 56.88% at HK$3.42. Merck's successful Phase III mRNA cancer vaccine trial directly ignited the global pharmaceutical sector. 3D MEDICINES has long been positioned in the oncology space, from the world's first subcutaneous PD-L1 injection to the world's first WT1 tumor vaccine. The company has built its own LNP delivery system and AI-based tumor vaccine screening platform, along with In-vivo CAR-T/NK technologies, all targeting the most cutting-edge international frontiers and resonating with the global top-tier tumor immunotherapy track.

HAIZHI TECH GP (02706) delivered an outstanding performance, closing up 15.19% at HK$44.60. Palantir's second-quarter revenue surged 94% year-on-year, with the company significantly raising its full-year sales guidance to $8.16 billion, far exceeding market estimates. The market widely regards HAIZHI TECH GP as the "Chinese version of Palantir," given the high alignment in underlying technology and government-enterprise service business models. HAIZHI TECH GP leverages its graph database as the foundation to host enterprise data assets, deploys intelligent agent products to execute business processes, and builds a full-stack capability spanning "data governance, knowledge modeling, graph reasoning, and intelligent agent execution."

DIAGENS-B (02526) strengthened throughout the trading session, closing up 27.05% at HK$421.80. The company's first-half model service revenue reached RMB 94.541 million, a significant 101.1% year-on-year increase, with its share of total revenue rising from 52% in the same period last year to 87%, making it the core engine driving revenue growth for the period. Currently, DIAGENS-B has developed its proprietary iMedImage® medical imaging foundation large model, featuring a hundred-billion parameter scale and covering 19 medical imaging modalities across 26 clinical specialties.

CHINA BLUECHEM (03983) declined following its earnings release, closing down 7.64% at HK$1.995. The company reported interim results with first-half revenue of RMB 5.619 billion, down 3.95% year-on-year. Profit attributable to shareholders amounted to RMB 507 million, a decrease of 20.78% year-on-year. With current fertilizer export restrictions combined with the domestic agricultural off-season for fertilizer use, earnings pressure is unlikely to ease in the near term.