Front-month contracts at the morning close: IF (CSI 300) -1.05%, IH (SSE 50) -0.73%, IC (CSI 500) -1.74%, IM (CSI 1000) -2.33%.

China's Shanghai Composite Index opened down 23.15 points (-0.60%) at 3,853.63 on Friday, July 24; Shenzhen Composite Index opened down 208.27 points (-1.47%) at 13,915.04; CSI 300 Index opened down 42.59 points (-0.90%) at 4,685.41; ChiNext Index opened down 60.02 points (-1.68%) at 3,515.50; STAR 50 Index opened down 23.43 points (-1.31%) at 1,766.26.

Galaxy Overseas analysts say Tencent's Q2 results are likely to hold up, supported by games and advertising; they forecast domestic games revenue +8% YoY and international games revenue +15% YoY. They expect Tencent to boost AI-related investment in H2 to upgrade its Hunyuan large model, cloud infrastructure and AI agent services. Galaxy Overseas projects full-year capex of CNY103 bln and says Tencent may step up capex in H2. The broker maintains an Overweight rating on Tencent (00700.HK) with a target price of HK$702.00.