New DeepSeek, Alibaba Models Take On Anthropic, OpenAI | The China Show | 8/3/2026

Yen Intervention and Market Impact [0:09]

• Japan and the U.S. confirmed their first joint currency market intervention in 15 years to strengthen the Japanese yen.
• Dollar-yen fell below the 157 handle following the intervention, a level closely watched by markets.
• Analysts suggest this move could signal a shift in the yen's weakening trend, potentially marking a peak for dollar-yen.
• The intervention is seen as a strong signal to market participants, making it expensive to bet against the yen.

  "Yeah, so we brought in some reinforcements, given, of course, how big the market moves are today."

China's AI Competition Intensifies [0:30]

• Asian tech stocks dropped following the launch of DeepSeek's new AI model, V4 Flash, seen as a threat to the AI trade.
• DeepSeek's latest release competes with rivals at a fraction of the cost, with price cuts of up to 50% on tokens.
• This aggressive pricing strategy could increase market adoption and make it feasible for smaller companies to host AI platforms.
• Other Chinese AI companies like Minimax and ByteDance are also releasing upgraded models, escalating competition.

  "But where DeepSeq is unbeatable is the pricing, because DeepSeq has now cut price. Even further when it comes to its tokens, both the input and output tokens, as much as a 50% price cut."

Oil Prices Decline on Iran Talks [0:49]

• Oil prices fell as the U.S. and Iran planned a return to the negotiating table.
• President Trump announced new discussions would begin, calling off a planned attack on Iran.
• Diplomatic sources suggest Qatari intervention is facilitating talks between the U.S. and Iran.
• Key issues for negotiation include reopening the Strait of Hormuz and curbing Iran's atomic ambitions.

  "President Trump there saying new Iran talks will begin on Monday afternoon after he called off a planned attack, partially in response to pleas from U.S. allies."

Hang Lung Properties Reports Profit Drop [1:41]

• Hang Lung Properties reported a steep drop in first-half profits.
• The decline was primarily due to a non-cash provision reflecting slower-than-expected sales in China.
• Underlying leasing profit, foot traffic, and mall sales showed strength, leading to cautious optimism.
• The company's new mall in Hangzhou is performing well, exceeding expectations and contributing significantly to recurring income.

  "So the top line numbers are not great, but that's primarily because we had a provision, which is a non-cash provision really reflecting the slower sales in China than we had expected."

AI Model Performance and Cost Analysis [3:18]

• DeepSeek's V4 Flash model shows improved performance and autonomous agent capabilities, scoring 50 on Artificial Analysis's intelligence index.
• While still trailing Kimi K3, it has edged out models from Alibaba and Minimax.
• DeepSeek is the cheapest AI model in China, with V4 Pro costing 5 cents per task and the Flash model seeing up to a 50% price cut.
• The intelligence versus cost trade-off shows DeepSeek dominating the top-left quadrant (cheap and intelligent), making it attractive for smaller and mid-sized companies.

  "But what is unbeatable about Deep Seek is the pricing. So, you flip the board and look at the cost. Deep Seek is now the cheapest model in China."

China's Economic Signals and Policy Outlook [7:50]

• Private manufacturing PMI data for July missed expectations, coming in at 50.9.
• The Politburo meeting indicated a sober assessment of the external environment and a need to boost domestic demand.
• Experts expect a pickup in fiscal expenditure from the central government to support strategically important projects like AI and new energy networks.
• Consumer consumption policies are expected to be pragmatic and proven effective, with less emphasis on large-ticket item subsidies.

  "But the tone, I must say, if you examine the past five to six meetings, it's a little less urgent in terms of boosting growth or counter-cyclical management."

Macau Gaming Revenue Decline [10:11]

• Macau's gross gaming revenue (GGR) fell 8.4% year-on-year in July, worse than expected.
• The decline was attributed to travel disruptions from a typhoon and distractions from the World Cup.
• Analysts expect a recovery in August, potentially larger than usual, with casino operators lining up entertainment events.

  "July numbers came in, came in down 8.4 percent year and year. So that's actually a little worse than consensus around 6 percent."

Hong Kong Property Market Outlook [11:24]

• The Hong Kong residential market has seen a revival, with prices up significantly and volumes at a seven-year high.
• Hang Lung Properties is bullish on Hong Kong and considering involvement in projects like the Northern Metropolis.
• The office recovery in Hong Kong feels real, with rents and occupancies increasing in core areas.
• Challenges remain for the mainland China office market, with a focus on repurposing office towers for retail and services.

  "Hong Kong feels really good for us. I mean, I think that will ultimately include the Northern Metropolis short term. It's harder to say how that will pan out. But we're very bullish on Hong Kong."