The shares rose 6.2%, driven by growth in Stock Trading Europe.

Chinese stocks rebounded strongly: Stock Trading and Shopee led the gains (July 28, 2025)

1. Performance of core stocks

① Stock Trading (PDD) surged 6.2%

Direct catalyst: Temu's European business grew beyond expectations

The latest data shows that Temu's market share in core markets such as Germany and France exceeded 15%, and its GMV growth rate in a single quarter reached 65%

Logistics efficiency increased to "15 days to arrive", and the return rate dropped to 8% (industry average 12%)

Business highlights:

Shopee's share of total revenue increased to 42%

North America/European customer unit price increased 28% year-on-year to $45

② Shopee (BABA) Hong Kong ADR rose 3.5%

Buyback increased: announced to expand stock buyback plan from US$10 billion to US$15 billion (2025-2026)

US$5.6 billion has been repurchased so far this year, with an average price premium of 18% over the current price

Strategic adjustments have taken effect:

Revenue of the international digital business sector increased by 41% (driven by Cainiao + AliExpress)

Alibaba Cloud achieved profitability, with AI-related revenue accounting for 25%

2. Overall performance of the sector

Nasdaq Golden Dragon Index closed up 4.1%, the largest single-day increase in three months

Other key stocks:

JD.com (JD) rose 5.8% (instant retail business exceeded expectations)

Li Auto (LI) rose 7.2% (delivery volume hit a new high in July)

Yum China (YUMC) rose 4.3% (digital orders accounted for 85%)

3. Rebound drivers

① Policy improvement

China-US audit supervision cooperation has made progress, and the PCAOB has completed a new round of audit inspections of Chinese concept stocks

China Securities Regulatory Commission optimized the overseas listing filing process, and the approval period was shortened to 20 working days

② Funding support

Southbound funds have been net buying Hong Kong technology stocks for 18 consecutive days, with a total of more than HK$60 billion

Global funds' allocation ratio to China's technology sector has rebounded from 5.2% to 6.8% (Morgan Stanley data)

③ Valuation repair demand

The dynamic PE of the Chinese concept Internet sector is only 18 times, lower than the five-year average of 24 times

Stock Trading/Alibaba and other core targets PEG are all less than 1 (indicating that the growth potential is underestimated)

4. Institutional views

Goldman Sachs: Maintain Stock Trading's "buy" rating, target price $220 (35% room from the current price)

JPMorgan Chase: Include Alibaba in the Asia-Pacific focus recommendation list, optimistic about the potential of cloud business spin-off

CITIC Securities: It is recommended to overweight Chinese concept Internet, and Q3 is expected to usher in a double performance and valuation

5. Risk warning

Global macroeconomic fluctuations may affect the pace of consumption recovery

Potential impact of geopolitical factors on cross-border business

Profit margin pressure caused by intensified industry competition

Market outlook: In the short term, pay attention to the performance of the August financial report season, and in the medium and long term, be optimistic about the growth momentum brought by digitalization and AI application. Investors are advised to pay attention to: 1) Shopee leader; 2) cloud computing leader; 3) smart electric vehicle track.