CGS International
June 10, 2025

Hong Kong Market Outlook: JD Health Surges, AIA Group Shines Amid Renewed US-China Trade Talks

Market Recap: Trade Talks and Sector Catalysts Set the Stage

The Hong Kong equity landscape is abuzz as the US and China prepare to resume critical trade negotiations, focusing on rare-earth minerals and advanced technology. After months of tariff escalations and retaliatory measures, both sides have shown signs of possible reconciliation, with rare-earth mineral flows at the center of these discussions. This evolving backdrop injects fresh momentum into key sectors and stocks, especially those with exposure to international supply chains and advanced tech.

JD Health International Inc (6618 HK): Uptrend Resumed, Technical Buy Signal

Last Price: HK\$41.20
Broker Rating: Technical Buy
Sector: Retail/Healthcare e-Commerce

Company Overview:
JD Health International Inc. is a leading drug store operator in China, retailing a comprehensive range of Chinese and Western medicines, nutrition products, health care products, and related goods across the Chinese market.

Technical Analysis and Investment Thesis

• JD Health has resumed its uptrend, rebounding impressively from the third buy limit price, delivering a 52% gain since the previous update in February 2025.
• The uptrend channel has remained intact since August 2024, underlining the stock’s robust technical foundation.
• A bullish breakout from a flag pattern signals strong continuation potential.
• All Ichimoku indicators confirm a bullish trend, with prices trending above key Ichimoku lines.
• The MACD histogram is positive, and both MACD and signal lines are positioned above the zero line.
• The Stochastic Oscillator remains elevated above the 50-level midpoint, indicating bullish momentum.
• The 23-period Rate of Change (ROC) is positive, further supporting the bullish view.
• Directional movement index indicates a return of bullish strength.
• Trading volume shows healthy expansion—an important confirmation of the uptrend.

Key Trading Levels

JD Health’s technical configuration suggests significant upside potential, making it an attractive candidate for momentum-focused investors. The stock’s strong price action, positive technical signals, and rising volume add to the conviction behind the technical buy call.

AIA Group: Leadership Change Sparks Optimism

Broker Rating: Add
Target Price: HK\$103
Sector: Insurance/Financials

AIA Group stands out with a leadership transition that has drawn positive market attention. The appointment of Mark Tucker as Chairman, effective October 1, 2025, is seen as a strong catalyst for the group’s sustained growth and stability. Tucker, with a proven track record and deep understanding of AIA’s operations, is expected to bolster investor confidence.

Performance Insights

• During Mark Tucker’s previous tenure, AIA’s share price increased by an average of 4% in the five-day trading window around results announcements.
• The group remains a top sector pick, with the Add rating and HK\$103 target price reiterated.

Macroeconomic & Geopolitical Context: US-China Trade Talks Back in Focus

Recent diplomatic overtures between the US and China have reignited hopes of easing technology and rare-earth mineral restrictions. The upcoming high-level meeting in London, featuring US Treasury and Commerce Secretaries alongside China’s Vice Premier, could mark a turning point for cross-border technology flows and export policies. Any reversal or relaxation of restrictions on advanced technology and mineral exports would have substantial implications for sectors reliant on global supply chains, particularly healthcare, technology, and automotive.

Key talking points from the negotiations include:

• Resumption of rare-earth mineral flows, vital for electronics and defense industries.
• Potential reconsideration of US restrictions on AI chips, chip design software, and advanced tech exports.
• Implications for Chinese students’ visas and talent mobility.

Recommendation Framework and Ratings Overview

CGS International utilizes a clear, investor-focused rating system:

• Add: Expected total return exceeds 10% over the next 12 months.
• Hold: Expected total return between 0% and 10%.
• Reduce: Expected total return below 0%.

(Data as of March 31, 2025; 551 companies under coverage)

Key Takeaways for Investors

• JD Health International is positioned for a significant technical breakout, with robust upside targets and strong momentum indicators.
• AIA Group’s strategic leadership change enhances its status as a sector favorite, supported by historical performance and a clear growth trajectory.
• Broader market sentiment is buoyed by renewed US-China trade negotiations, with potential sector-wide ramifications if restrictions are eased.

Investors are advised to monitor technical signals, leadership developments, and macro policy shifts closely as catalysts for future performance across Hong Kong’s leading stocks.