**Today's Headlines** Fed Beige Book Shows Employment Levels Generally Stable, September Rate Cut Probability at 96.6%

The Federal Reserve's Beige Book indicated that eleven districts reported employment levels remained generally stable or showed little net change, while one district experienced a moderate decline. Seven districts noted that businesses remained cautious about hiring due to weak demand or economic uncertainty. Minneapolis Fed President Kashkari stated Wednesday that the Federal Reserve has some room to lower short-term benchmark interest rates, though he did not reveal when policy easing might be needed. Atlanta Fed President Bostic reiterated his view that one rate cut this year would be appropriate, though this could change depending on inflation and labor market conditions. According to CME's "FedWatch": The probability of the Fed keeping rates unchanged in September is 3.4%, while the probability of a 25 basis point cut is 96.6%. For October, the probability of keeping rates unchanged is 1.6%, the probability of a cumulative 25 basis point cut is 46.8%, and the probability of a cumulative 50 basis point cut is 51.6%.

**Market Outlook** Overnight US Stocks Mixed, Nasdaq Golden Dragon China Index Down 0.19%

Overnight US markets closed mixed, with the Dow falling 24.71 points or 0.05% to 45,271.10; the Nasdaq rising 218.10 points or 1.02% to 21,497.73; and the S&P 500 gaining 32.72 points or 0.51% to 6,448.26. Alphabet (GOOG.US, GOOGL.US) surged over 9%, Tesla (TSLA.US) rose over 1.4%, while Nvidia (NVDA.US) declined slightly by 0.09%. Figma Inc (FIG.US) plunged nearly 14% in after-hours trading, with Q2 revenue of $249.6 million, up 41% year-over-year, adjusted net profit of $11.5 million, and full-year revenue guidance of $1.021-1.025 billion.

Popular Chinese concept stocks closed mixed, with the Nasdaq Golden Dragon China Index down 0.19%. DUO declined nearly 15%, XPeng fell over 2%, and Alibaba dropped over 1%; while PDD Holdings rose over 2% and iQiyi gained over 1%.

Hang Seng Index ADRs declined, closing at 25,337.35 points on a proportional basis, down 6.08 points or 0.02% from Hong Kong's close. COMEX gold futures for the nearby contract rose $43.30 or 1.21% to $3,635.5 per ounce.

**Hot Topics Preview** Hong Kong Exchanges: RMB-HKD and RMB-USD Haircut Rates to Remain at 2.6% After Market Close on September 5

On September 3, Hong Kong Exchanges issued a notice stating that pursuant to CCASS Operational Procedures Rules sections 10.10.1 and 10.10A.1, HKSCC has determined that the haircut rates for RMB-HKD and RMB-USD will remain at 2.6% after market close on September 5, 2025. This haircut rate will apply when Clearing Participants choose to pay daily in HKD or USD for any settlement shortfall, margin, and collateral requirements denominated in RMB, and vice versa. Clearing Participants should make necessary funding arrangements to meet any related requirements adjusted by the RMB haircut rate.

DBS Bank: Hong Kong Stocks May Enter Consolidation Phase Due to Short-term Liquidity Tightening, Bullish on Technology and Non-bank Sectors

DBS Bank stated that Hong Kong stocks may enter a consolidation phase in the near term due to local liquidity tightening and investors awaiting signals of China's fundamental stabilization, though long-term prospects remain attractive. Ying Yuhua, Director of DBS Hong Kong Research and Hong Kong & China Equity Market Strategist, said at a briefing that local funding liquidity is unlikely to improve significantly in the short term. Southbound funds that drove market gains earlier this year have recently decelerated, with some investors expected to shift attention back to mainland markets. Foreign capital inflows remain a bright spot, with passive funds continuing to flow in and small amounts of active funds returning to Hong Kong stocks since last week. The bank is optimistic about technology and non-bank financial stocks, believing China's anti-involution measures will create trading opportunities. It expects the Hang Seng Index to fluctuate around 25,000 points in the near term, with a 12-month target of 26,000 points.

FTSE China A50 Index Quarterly Review Changes Include BeiGene and Three Other Stocks

On September 3, FTSE Russell announced quarterly review changes to the FTSE China 50 Index, FTSE China A50 Index, FTSE China A150 Index, FTSE China A200 Index, and FTSE China A400 Index. The changes will take effect after market close on Friday, September 19, 2025. Additions include BeiGene-U (688235.SH) and WuXi AppTec (603259.SH), while China National Nuclear Power (601985.SH) and others will be removed.

Minsheng Insurance Continues to Increase Holdings in Zheshang Bank H-shares, Ownership Exceeds 6% of Total H-shares

According to Hong Kong Stock Exchange disclosure information, Minsheng Insurance increased its holdings by 4 million Zheshang Bank H-shares on September 2, bringing its total Zheshang Bank H-share holdings to nearly 357 million shares, representing over 6% of the bank's total H-shares. Previously, Minsheng Insurance's Zheshang Bank H-share holdings exceeded 5% of the bank's H-share capital in early August, triggering the disclosure threshold.

Chifeng Gold: Rare Earth Business Represents Small Proportion, Currently in Early Development Stage

Chifeng Gold stated on the interactive platform on September 3 that the company adheres to a "gold-focused" development strategy, with rare earth business representing a small proportion and currently in the early development stage.

LEAPMOTOR (09863) Completes RMB 2.6 Billion Domestic Share Placement

On August 29, LEAPMOTOR completed its domestic share placement, raising a total of RMB 2.6 billion. CITIC Securities served as the lead underwriter for this issuance. The placement introduced four state-owned shareholders: Wuyi County Gold Investment Industrial Development Holding Group Co., Ltd., Jinhua Industrial Fund Co., Ltd., Huzhou Xinchuang Equity Investment Partnership, and Hangzhou Hehe Leapmotor Equity Investment Partnership.

UBTECH ROBOTICS (09880) Announces RMB 250 Million Contract for Embodied AI Humanoid Robot Products and Solutions

UBTECH ROBOTICS announced it has secured a RMB 250 million contract from a well-known domestic enterprise for embodied AI humanoid robot products and solutions. The contract primarily involves the humanoid robot Walker S2, with UBTECH to begin contract delivery within this year.

VAC: Robotics Sector Expected to Become One of Company's Important Future Growth Drivers

VAC stated during institutional research on September 3 that embodied robots represent one of the important future demand growth drivers for high-performance NdFeB magnetic materials and motor rotors. The company has upgraded relevant R&D departments to the Embodied Robot Motor Rotor Business Unit, with the company's CEO serving as strategic coordinator for the business unit. Currently, based on customer needs, the company has made supporting investments in project-specific facilities, dedicated equipment, and professional teams, achieving initial large-scale production capabilities. The company delivered small-batch products in the first half of 2025, with the robotics sector expected to become one of the company's important future business growth drivers.

SMARTONE TELE (00315) Reports Annual Results with Shareholders' Profit of HK$478.9 Million, Up 1.87% Year-over-Year

SMARTONE TELE (00315) announced its full-year results for 2024/2025, achieving revenue of HK$6.253 billion, up 0.52% year-over-year; shareholders' profit of HK$478.9 million, up 1.87% year-over-year; earnings per share of HK$43.5 cents, with a proposed final dividend of HK$17.5 cents per share.

**Individual Stock Highlights** AB&B BIO-TECH-B (02627): Marketing Application for Quadrivalent Influenza Virus Subunit Vaccine Approved by NMPA

AB&B BIO-TECH-B (02627) announced that the company's board is pleased to announce that China's National Medical Products Administration (NMPA) has approved the group's New Drug Application for the quadrivalent influenza virus subunit vaccine for the 6-35 month age group.