Hang Seng Falls to Near 2-Week Low as Super Typhoon Nears

The Hang Seng Index fell about 0.5% to close at 25,752 on Thursday, retreating from the previous session’s rally as Asian markets turned cautious. Sentiment was weighed down by fragility and tensions in the Middle East, which continue to drive volatility in oil prices and raise concerns that inflationary pressures could persist longer than expected. Iran’s move to restrict shipping and impose tolls in the Strait of Hormuz, an essential global oil route has further unsettled markets, posing risks to global economic growth and equity performance. On the data front, China’s March CPI and PPI are due on Friday, with inflation expected to ease to 1.2% from 1.3% and PPI to rebound 0.4% after a 0.9% drop, with the data key for Hong Kong stocks as it signals mainland demand and pricing power shaping earnings prospect for China-linked firms. Only the technology, energy minerals, and utilities sectors posted gains. Notable laggards included Xiaomi (-4.3%), Sinotruk (-2.8%), and Kuaishou (-3.6%).

The Hang Seng Index edged up 776 points, or 3.1%, to close at 25,893 on Wednesday, marking its highest finish of the week, as broad-based buying swept through Hong Kong equities. Investor sentiment was lifted by news of a tentative two-week ceasefire between the United States and Iran, easing concerns over Middle East tensions that had recently weighed on markets. The rally extended beyond purely geopolitical relief, with a combination of lower oil prices, a strengthening yuan, and positive momentum in key Hong Kong sectors reinforcing investor confidence. Most sectors in Hong Kong stock market saw positive momentum, with financials and technology stocks leading the rally. Market movers included Tencent Holdings (+3.8%), Meituan Class (+9.97%), Xiaomi Corporation (+5.5%), Semiconductor Manufacturing (+10.2%), and Pop Mart International (+7.1%).

The Hang Seng Index climbed 707 points, or 2.4%, to 25,725 on Wednesday, bouncing back from a 0.7% drop in the previous session and reaching this week’s highest level. Broad gains across sectors lifted the market as investor confidence improved following a two-week ceasefire agreement between the United States and Iran, which helped ease concerns over military disruptions and reopened the Strait of Hormuz. The deal also contributed to a decline in crude oil prices and supported a rebound Asian equity. Locally, the market opened after the Easter holidays with renewed focus on structural drivers such as a surge in IPO activity in Hong Kong, where more than 40 companies have completed listings this year. Financials, technology, and consumer stocks led the rally, with Shanghai Iluvatar CoreX (17%), Knowledge Atlas Tech (16%), and Jiaxin Intl Rscs Invt (15%). Meanwhile, the early laggards included CNOOC (-3.7%), RemeGen (-2.9%), and SC Kelun-Biotech Biopharm (-2.8%).