Rally at the close! Chery Automobile surges over 15% with record volume! The new energy vehicle sector welcomes multiple positive factors, and the Hong Kong Stock Connect Auto ETF Huabao (520780) rises against the trend!

Thursday (April 2nd), Hong Kong stocks’ new energy vehicle sector defied the market trend and strengthened. By the close of trading, Chery Automobile surged over 15% in the last trading session, with a record-breaking turnover of 770 million yuan. Geely Auto rose over 8%, and Great Wall Motors increased over 5%.

In popular ETFs, the Hong Kong Stock Connect Auto ETF Huabao (520780), focused on Hong Kong stocks’ new energy vehicles, performed against the trend and gained throughout the day, closing up 0.88% at 3 p.m. Notably, due to trading time differences, its target index closed up 1.48% for the day, and it is expected that this ETF may experience a catch-up rally after tomorrow’s market open.

Based on comprehensive market information, the active performance of the Hong Kong Stock Connect Auto sector against the trend may be driven by multiple factors:

1. Sales performance: Several automakers announced March delivery figures, generally showing significant growth. Chery Automobile’s five major brands’ total sales increased approximately 15% year-over-year, Leapmotor returned to a monthly sales of 50k units, ranking first among new power players with a 35% YoY increase and a 78.25% MoM increase. Li Auto and Xpeng Motors both achieved varying degrees of growth compared to last month.

2. Performance: Both traditional automakers and new entrants in vehicle manufacturing demonstrated strong performance improvement trends. Among companies that have released 2025 annual reports, Geely and Chery each reported revenues exceeding 300 billion yuan, driven by new energy vehicles and overseas markets. For new entrants, Leapmotor achieved full-year profitability in 2025, while NIO and Xpeng both turned profitable in Q4.

3. Macro drivers: Oil prices remain high, boosting expectations for electrification demand. High oil prices increase the operating costs of fuel vehicles, encouraging consumers to switch to electric vehicles, with inquiry volumes in the US and Europe increasing by 15%–36%. Analysts believe this will boost demand for pure electric vehicles in the medium term and may reverse the previous slowdown trend among some European and American automakers’ electrification efforts.

Looking ahead, CITIC Construction Investment states that at this point, the domestic demand outlook for passenger cars and sector valuations may have bottomed out. Structural alpha is optimistic about export surprises in passenger cars and accelerated volume growth in high-end new energy vehicles. Valuation space is promising for physical AI-driven growth paradigms. The export of new energy vehicles is expected to enter a new cycle of rapid growth from the second half of 2025, driven by both supply and demand under high oil prices, with performance potentially exceeding expectations significantly in 2026.*

For Hong Kong Stock Connect new energy vehicle industry chain deployment, it is recommended to focus on actively traded T+0 products such as the Hong Kong Stock Connect Auto ETF Huabao (520780), which targets the whole vehicle segment while covering auto parts, industrial metals, and other sub-sectors. It benefits from high auto consumption, the accelerated deployment of L3-L4 intelligent driving, and spillover benefits from robotics, with heavy holdings in leading Hong Kong stocks like Xpeng, BYD, Li Auto, and Geely.

Data source: Shanghai and Shenzhen Stock Exchanges, etc.

ETF-related fee note: When investors subscribe or redeem fund shares, the subscription or redemption agent may charge a commission of up to 0.5%. Transaction fees on the exchange are based on the actual charges by securities firms; no sales service fee is charged.

*Institutional view reference: CITIC Construction Investment Securities “Passenger Car Industry Cycle, Structural Alpha, and Investment Review”

Risk warning: The Hong Kong Stock Connect Auto ETF Huabao passively tracks the CSI Hong Kong Stock Connect Auto Industry Theme Index, with a base date of December 30, 2016, and published on July 21, 2022. The annual gains/losses of the CSI Hong Kong Stock Connect Auto Industry Theme Index from 2020 to 2024 are 92.68%, -1.21%, -43.88%, 5.92%, and 5.57%, respectively. The index components are adjusted according to the index rules, and past backtested performance does not predict future performance. The index components shown are for display only; individual stock descriptions are not investment advice and do not represent holdings or trading activity of any fund managed by the manager. The risk level of this fund, as assessed by the fund manager, is R4—medium-high risk, suitable for active investors (C4) and above. All information in this article (including but not limited to individual stocks, comments, forecasts, charts, indicators, theories, or any form of expression) is for reference only. Investors are responsible for their own investment decisions. The views, analysis, and forecasts in this article do not constitute investment advice and do not hold the author or fund manager liable for any direct or indirect losses resulting from using this content. Fund investments carry risks; past performance does not guarantee future results. The performance of other funds managed by the fund manager does not guarantee the performance of this fund. Investment should be cautious.

MACD Golden Cross signals formed, these stocks are on a good upward trend!