Hang Seng Erases Early Gains, Ends Slightly Lower

The Hang Seng Index fell 158 points, or 0.6%, to close at 24,408 on Wednesday, extending losses for a sixth consecutive session and remained its lowest level since late March. Investor sentiment remained fragile amid escalating tensions in the Middle East and a renewed selloff in selected technology shares. Markets were pressured after reports that US forces launched fresh strikes against Iran following the downing of an American helicopter, raising concerns about broader regional instability and threatening a fragile ceasefire. Oil prices also rebounded on fears of potential supply disruptions. Meanwhile, investors assessed China's latest inflation data, which showed annual consumer price growth held steady at 1.2% in May, unchanged from April, reinforcing expectations that policymakers may continue implementing measures to aid economic recovery. Among the biggest decliners were SMIC (-3.7%), Xiaomi (-3.2%), Lenovo (-9.5%), Kingboard Laminates (-3.2%), and AIA (-1.3%).

The Hang Seng Index slipped 91 points, or 0.4%, to close at 24,566 on Tuesday, extending losses for a fifth straight session and hovering near its lowest level since late March. Sentiment remained fragile despite reports that tensions in the Middle East eased following a halt in hostilities between Israel and Iran and as optimism surrounding AI-related stocks improved. Finance, retail trade and energy minerals posted losses while selected technology stocks gained. Notable decliners included AIA (-2.2%), Pop Mart (-1.4%), Knowledge Atlas Technology (-12.8%), and Xiaomi (-0.7%). In contrast, Tencent advanced 1.8% and Semiconductor Manufacturing International Corporation gained 3.2%, helping the benchmark recover from earlier losses. Investors remained cautious over the broader pace of China's economic recovery despite stronger-than-expected Chinese trade data, with both exports and imports exceeding forecasts on solid demand for technology hardware amid rising global AI investment.

The Hang Seng Index tumbled 305 points, or 1.2%, to close at 24,585 on Monday, extending last week's losses and the lowest level since late March. The selloff mirrored a sharp global retreat in technology and AI-related stocks after stronger-than-expected U.S. jobs data reinforced expectations that the Federal Reserve may keep interest rates higher for longer. Broader risk sentiment was also weighed down by renewed geopolitical tensions after reports of Iranian missile launches toward Israel threatened a fragile ceasefire and pushed oil prices higher. Technology and semiconductor-related shares led the decline, tracking a wider global AI-driven market correction. Investors nevertheless viewed the pullback as largely driven by profit-taking rather than deteriorating fundamentals, with some market participants seeing the weakness as a potential buying opportunity. Among the biggest drags were Tencent (-1.5%), SMIC (-4.1%), AIA Group (-1.8%), Lenovo (-1.3%), and Meituan (-3.5%).