CGS International
July 22, 2025

Hong Kong Trendspotter: Technical Insights and Sector Analysis for Retail Investors – July 2025

Market Overview: Earnings Season, Tariff Tensions, and Global Market Movements

As the global financial markets kick off a busy earnings week, investor sentiment remains cautious but hopeful. Major indices in the U.S. showed only modest gains despite the S&P 500 closing above 6,300 for the first time, rising by just 0.1%. Notably, the energy sector lagged alongside a decline in oil prices, and chipmakers saw their earlier advances nearly erased as Nvidia shares slipped. With Tesla and Alphabet ready to launch this quarter’s tech earnings, the focus is squarely on updates regarding artificial intelligence spending.

Treasury yields dropped, led by declines in longer maturities, with the 30-year yield falling by four basis points to 4.95%. The dollar weakened against major peers, while the yen strengthened as Japan’s Prime Minister Shigeru Ishiba vowed to remain in office despite a setback in the upper house elections. Tariff risks remain in focus, with potential new unilateral tariff announcements from U.S. President Donald Trump expected before August 1. As the Trump Administration signals a tougher stance on tariffs, analysts emphasize that guidance from companies during this earnings season will be more crucial than ever, with significant earnings estimate upgrades required to meet current Wall Street targets.

Trip.com (HKG: 9961): Strong Summer Travel Outlook Amidst Competitive OTA Landscape

• Summer Travel Projections: Domestic travel and outbound travel revenues for July–August 2025 are set to rise by mid-to-high single digits and mid-to-high teens year-on-year, respectively.
• Competitive Positioning: Recent moves by JD and Douyin to boost subsidies in the online travel agency (OTA) space are not expected to threaten Trip.com’s market share, thanks to its robust presence in the high-end hotel segment.
• 2Q25 Financial Forecast: Revenue is forecasted to increase by 14.5% year-on-year in Q2 2025. However, non-GAAP net profit is projected to decline by 10.3% year-on-year due to aggressive overseas expansion initiatives.
• Investment Recommendation: The rating remains “Add” with a discounted cash flow-based target price of HK\$588.0. Assumptions include a WACC of 10.1% and terminal growth of 3%.

Technical Spotlight: Microport Cardioflow Medtech Corp (HKG: 2160) – Bullish Reversal in Play

Company Overview: Microport Cardioflow Medtech Corporation specializes in developing and commercializing medical devices, including the Vitaflow aortic valve system and Alwide balloon catheter, with a strong presence across China.

Technical Analysis and Trade Setup

• Pattern Formation: An ascending triangle is forming at the bottom of the price action, signaling a bullish reversal.
• Trend Confirmation: The stock has broken out of a major downtrend line, gapped up, and remained above the gap for three consecutive periods.
• Technical Indicators:
  • Ichimoku Cloud: Shows a strong bullish signal.
  • MACD: Histogram is positive; both MACD and signal lines have moved above the zero line steadily.
  • Stochastic Oscillator: Continues to rise, indicating growing momentum.
  • Rate of Change (23-period): Positive and climbing.
  • Directional Movement Index: Indicates increasingly strong bullish momentum.
  • Volume: Healthy expansion, reinforcing the bullish case.

Key Takeaways for Investors

• Market dynamics are shifting amid earnings season and heightened tariff concerns; investor focus should be on the quality of corporate guidance and the ability of companies to deliver substantial earnings upgrades.
• Trip.com is positioned to benefit from robust travel demand in the summer, with its high-end market focus providing resilience against increased competition.
• Microport Cardioflow Medtech presents a compelling technical buy opportunity, with multiple indicators confirming a bullish reversal and significant upside potential.

Stock Ratings and Methodology

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

Sector and Country Ratings

• Sector Overweight: Market-cap weighted stocks have a positive absolute recommendation.
• Sector Neutral: Market-cap weighted stocks have a neutral recommendation.
• Sector Underweight: Market-cap weighted stocks have a negative recommendation.
• Country Overweight: Position above benchmark.
• Country Neutral: Position at benchmark.
• Country Underweight: Position below benchmark.

Distribution of Ratings (as of June 30, 2025)

Coverage: 561 companies as of June 30, 2025.

Conclusion

July 2025 marks a pivotal moment for investors, with the combination of earnings volatility, geopolitical trade risks, and technical signals defining opportunities across Hong Kong’s retail sector and beyond. Trip.com’s resilience in the face of intensified OTA competition and Microport Cardioflow Medtech’s bullish technical setup stand out as actionable insights for forward-looking investors.