To The Moon

💰 U.S. markets experienced a slight decline, while tech giants underperforming.

💹 $XIAOMI-W(01810)$/$LEAPMOTOR(09863)$/$SMIC(00981)$: HK market tech stars bolstered market enthusiasm through technological innovations.

📣 Stay tuned, supercharge purchasing power through CashBoost!

| The arrival of game-changers

Lei Jun, chairman of $XIAOMI-W(01810)$, announced that the company’s self-developed 3nm flagship chip has begun mass production, leading to a rally in China chip stocks.

NVIDIA CEO Jensen Huang revealed that due to U.S. government restrictions on the export of the Hopper architecture H20 chip to China, the company is reevaluating its market strategy in China and confirmed that it will no longer release the Hopper series chips.

With the end of the Hopper series, the gap in China's AI chip market will be filled by domestic manufacturers.

| Market recap

In the first two trading days of the week, affected by the negative impact of a U.S. credit downgrade and a lack of substantial positive catalysts, traders took profits, resulting in a slight decline across major indices.

This week’s strategy favors maintaining a cautious stance, controlling positions, and being mindful of risk management.

On Tuesday, $NASDAQ Golden Dragon China Index(HXC)$ fell 0.7%, while $Pony AI Inc(PONY)$ rose 5.7%.

Megacaps

Investors welcomed Elon Musk's commitment to lead the company, as $Tesla Motors(TSLA)$ was the only stock in the Magnificent 7 that did not drop last night.

• Elon Musk stated in an interview at the Qatar Economic Forum that he is dedicated to leading Tesla until at least the end of the decade.

• Additionally, he plans to reduce his political donations, marking a significant shift from his previous role in the 2024 election. By the end of June, Robotaxi is set to launch in Austin, Texas, and xAI will continue to purchase chips from NVIDIA and AMD, with plans to build a factory capable of housing one million GPUs.

• Following Musk's remarks, Tesla's stock opened higher on Tuesday, rising over 3.6% during the day before sharply declining at the close, ultimately finishing up about 0.5%.

Recently, $Microsoft(MSFT)$, $Alphabet(GOOG)$, and $Apple(AAPL)$ have released numerous technological advancements, primarily focused on AI, especially in the agent domain. However, the market did not show significant enthusiasm; aside from learning a few hundred new acronyms and terms, it seems that little was gained.

• $Alphabet(GOOG)$ was the worst performer in the Magnificent 7 last night, dropping 1.5%. GOOG’s core search business faces potential threats from AAPL, and the newly released technologies, such as AR glasses, video generation, and AI project assistants, align closely with market trends but fail to deliver unexpected innovations.

• In contrast, $Microsoft(MSFT)$'s BUILD conference featured endorsements from Musk, Huang, and Sam Altman for the Open Agentic Web concept, indicating a potential coalition.

Top movers

The healthcare sector ETF performed well, with $Direxion Daily S&P Biotech Bull 3x Shares(LABU)$ rising 5.3%, while $Direxion Daily Healthcare Bull 3X Shares(CURE)$ and $Direxion Daily Pharmaceutical & Medical Bull 3X Shares(PILL)$ continued their previous gains.

The pet economy is gaining popularity; interestingly, a similar trend was observed in the A-share market on Tuesday, with related stocks soaring: $Warby Parker Inc.(WRBY)$ increased by over 15%, $Boqii Holding Limited(BQ)$ and $Petco Health and Wellness Company, Inc.(WOOF)$ rose over 7%, and $Chewy, Inc.(CHWY)$ gained nearly 2%.

The autonomous driving Robotaxi concept stock $Pony AI Inc(PONY)$ surged 5.7%, with the company reporting explosive first-quarter performance: total revenue exceeded 100 million yuan, up 12% year-on-year, and passenger orders for the core Robotaxi business skyrocketed by 800%.

IPO watch

The IPO market for 2025 is gaining momentum, with notable returns recently from CoreWeave and CATL in the U.S. and Hong Kong markets. The pipeline for this year includes several star unicorns:

Chime - one of the leading neobanks in the U.S.

• Projected revenue for 2024 is $1.67 billion, representing a 31% year-on-year increase.

• Chime boasts 8.6 million active users, up approximately 23%, with an average revenue of $251 per active user.

• Chime's services are available in all 50 states but have not yet expanded internationally.

Figma - hopefully the largest IPO of the year

• Figma is a cloud-based online UI design tool that has become a favorite among many designers.

• Figma holds a 40.65% market share in the design software industry, outperforming competitors such as Adobe XD.

• Recently, Figma hired Morgan Stanley to lead its IPO and was most recently valued at $12.5 billion.

$MNTN, Inc.(MNTN)$ - Celebrity-backed media unicorn

• MNTN, which develops a cloud-based TV advertising platform and counts Ryan Reynolds (of Deadpool fame) among its executive team, filed its S-1 on May 14 and priced its IPO at $187 million.

| Tech stars: Innovation-driven growth

Notable movements are occurring among star technology stocks in the Hong Kong market, warranting close monitoring.

Xiaomi Group $XIAOMI-W(01810)$

The launch of Xiaomi's self-developed 3nm chip is viewed as a significant milestone in the domestic chip replacement process. This move makes Xiaomi the fourth company globally to release a 3nm mobile processor, following in the footsteps of Apple, Qualcomm, and MediaTek, with implications for the domestic chip industry.

In the past six months, Xiaomi has experienced a dramatic turnaround from highs to lows. On May 22, Lei Jun will address all criticisms at a press conference.

The release of the Xiaomi YU7 is highly anticipated; this mid-size SUV competes directly with Tesla's Model Y.

Leapmotor $LEAPMOTOR(09863)$

Leapmotor sees explosive sales this year, becoming the sales champion among new energy vehicle manufacturers in both March and April, and in April, it was the only new energy vehicle company to sell over 40,000 units in a month.

The company disclosed its latest financial report, revealing that in the first quarter of this year, Leapmotor achieved revenue of 10.02 billion yuan, a staggering year-on-year increase of 187%.

The gross margin in the first quarter reached 14.9%, achieving both sequential and year-on-year growth during the sales slump, marking a historic high.

SMIC $SMIC(00981)$

In the first quarter of 2025, SMIC reported revenue of 16.301 billion yuan, a year-on-year increase of 29.44%, with net profit up 166.5% year-on-year.

Benefiting from the growing demand in the domestic new energy vehicle and industrial control sectors, SMIC's automotive-grade products continue to make significant strides in key technology areas such as BCD, CIS, MCU, and domain controllers, with industrial and automotive revenue increasing by over 20% quarter-on-quarter, raising its contribution from 8% to nearly 10%. The company stated that it will continue to strengthen its layout in the automotive electronics sector in the future.

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