On May 11th, Hong Kong's hard tech stocks continued their strong rally at the open, with the "enhanced version of the Hang Seng Tech Index"—the CSI Hong Kong Connect Information Technology Composite Index—surging 2.51%, significantly outperforming the Hang Seng Tech Index (-0.03%). The largest and most liquid* HK Connect Information Technology ETF Huabao (159131) gapped up at the open, rising 2.77% intraday and aiming for its fourth consecutive positive session. As of this report, it leads the gains among all cross-border ETFs in the market! A massive 45 million shares were subscribed in a rapid capital inflow!

Central China Securities analysis pointed out that downstream demand shows a structural differentiation trend, with demand for AI computing power hardware infrastructure remaining robust. In Q1 2026, the capital expenditures of the four major North American cloud providers—Google, Microsoft, Meta, and Amazon—increased by 81% year-over-year and 10% quarter-over-quarter, with their 2026 capital expenditure plans also revised upwards. In Q4 2025, the capacity utilization rates of SMIC, Hua Hong, and UMC remained essentially flat quarter-over-quarter, with Hua Hong operating at full capacity. According to SEAJ data, global semiconductor equipment sales grew 8% year-over-year in Q4 2025, while sales in China grew 11% year-over-year. The semiconductor industry remains in an upward cycle, with AI being a key driver of growth.

Since its rebound from the low on March 31st, the underlying index of the HK Connect Information Technology ETF Huabao (159131)—the CSI Hong Kong Connect Information Technology Composite Index—has accumulated a gain of 27.79%. In the same period, the Hang Seng Tech Index and the HK Connect Technology Index rose by 9.19% and 7.78%, respectively, demonstrating significantly sharper momentum and greater elasticity.

Statistical period: March 31, 2026 - May 8, 2026. The annual historical returns of the HK Connect Information Technology C Index from 2021 to 2025 were: -9.54%, -34.47%, -0.25%, 21.58%, and 39.30%, respectively. Past performance of the index is not indicative of future results.

Supports T+0 trading! Directly targeting the Hong Kong stock semiconductor super cycle—the first, largest, and most liquid* HK Connect Information Technology ETF Huabao (159131) in the market. Its feeder fund code is 026755. The underlying index is composed of "70% hardware + 30% software," heavily weighted in Hong Kong-listed "semiconductors + electronics + computer software." It covers 52 hard tech companies listed in Hong Kong, with SMIC having a weight of 14.21%, Xiaomi Corporation-W at 10.31%, Lenovo Group at 9.33%, and Hua Hong Semiconductor at 8.82%. It excludes large-cap internet companies like Alibaba, Tencent, and Meituan, offering higher focus and greater potential to capture the Hong Kong AI hard tech trend. (As of May 5, 2026)

Data sources: China Securities Index Co., Ltd., Shanghai and Shenzhen Stock Exchanges. Note: "First in the market" refers to the HK Connect Information Technology ETF Huabao being the first ETF to track the CSI Hong Kong Connect Information Technology Composite Index. As of May 7, 2026, the latest on-exchange size of the HK Connect Information Technology ETF Huabao was 7.3 billion yuan, making it the largest among the 7 ETFs currently tracking the CSI Hong Kong Connect Information Technology Composite Index. Its average daily turnover year-to-date is 1.66 billion yuan. The annual historical returns of the underlying index, the CSI Hong Kong Connect Information Technology Composite Index (HKD), from 2021 to 2025 were: -9.54%, -34.47%, -0.25%, 21.58%, and 39.30%, respectively. Past performance of the index is not indicative of future results. Fund fee explanation: Subscription and redemption agents for the HK Connect Information Technology ETF Huabao may charge a commission of up to 0.5%. On-exchange trading fees are subject to the actual charges by securities firms. No sales service fee is charged. *Institutional views reference sources: China Merchants Securities "China Merchants Securities Industry Sentiment Observation: Steady Growth in May Day Travel Consumption, March Global Semiconductor Sales Growth Expands." Central China Securities "Semiconductor Industry Monthly: Overseas Cloud Providers Raise 2026 Capex Plans, CPU Returns to AI Data Centers."

Risk Disclosure: The HK Connect Information Technology ETF Huabao and its feeder fund passively track the CSI Hong Kong Connect Information Technology Composite Index. The base date of this index is November 14, 2014, and its release date is June 23, 2017. The index constituents mentioned in this material are for illustrative purposes only. Descriptions of individual stocks do not constitute investment advice in any form and do not represent the holdings or trading动向 of any fund managed by the fund manager. This product is issued and managed by Huabao Fund. Selling agents do not bear responsibility for the product's investment, redemption, or risk management. Investors should carefully read the Fund Contract, Prospectus, Fund Product Key Facts Statement, and other legal fund documents to understand the fund's risk-return characteristics and choose a product suitable for their own risk tolerance. Past fund performance is not indicative of future results. The performance of other funds managed by the fund manager does not guarantee the performance of this fund. Fund investment involves risks! The fund manager assesses this fund's risk等级 as R4 - Medium to High Risk, suitable for Aggressive (C4) and above investors. Selling institutions (including the fund manager's direct sales机构 and other selling机构) evaluate this fund's risk according to relevant laws and regulations. Investors should pay timely attention to the appropriateness opinions issued by selling institutions and base their decisions on the matching results. Appropriateness opinions from different selling institutions may not necessarily be consistent. The fund product risk等级 evaluation results issued by fund selling institutions shall not be lower than the risk等级 evaluation results made by the fund manager. The descriptions of the fund's risk-return characteristics in the fund contract and its risk等级 may differ due to different consideration factors. Investors should understand the fund's risk-return profile and谨慎 choose fund products based on their own investment objectives, horizon, experience, and risk tolerance, bearing the risks themselves. The China Securities Regulatory Commission's registration of this fund does not indicate a substantive judgment or guarantee of its investment value, market prospects, or returns. Funds carry risks; investment requires caution.

MACD golden cross signals formed; these stocks are performing well!