HK Stock Market Move | Auto stocks extend decline; nationwide retail sales down 26% year-on-year in first 18 days of the month; institutions say domestic demand remains weak.

Auto stocks extended their decline. As of press time, XPENG-W (09868) fell 4.33% to HK$35.38; LI AUTO-W (02015) fell 4.32% to HK$43.84; Great Wall Motor (02333) fell 2.86% to HK$6.625. On the news front, data from the China Automobile Dealers Association showed that nationwide retail sales in the passenger car market totaled 789,000 units from October 1 to 18, down 26% year-on-year from the same period last October; manufacturer wholesale volume was 853,000 units, down 20% year-on-year. New energy retail sales were 520,000 units, down 13% year-on-year. The "Golden September" was likewise lackluster. The auto dealer inventory warning index stood at 63.2% in September, remaining above the boom-or-bust line for consecutive periods, with 54.2% of dealers believing the peak-season effect was significantly weaker than in previous years. Central China released a research report stating that the auto industry in September showed an operating pattern of "domestic demand under pressure, strong export growth, channel inventory buildup, and structural divergence." On the domestic demand side, the seasonal rebound was evident, but the year-on-year decline widened further compared with August, as domestic demand remained weak under pressure from the high base in the same period last year and a wait-and-see sentiment. On the export side, exports stayed above one million units for the fourth consecutive month, with the share of new energy exports rising to 54.2%, and going overseas remains the industry's strongest engine. On the channel side, the auto dealer inventory coefficient rose to 1.68 in September, a high level for the same period in recent years, reflecting an intensifying contradiction between automakers pushing inventory during the peak season and weak terminal sell-through.