Hong Kong Shares Trims Early Losses

The Hang Seng Index fell 0.8% to close at 24,751 on Monday, paring steeper losses earlier in the session, as gains in energy offset some of the declines in technology and consumer stocks. Still, sentiment remained weak among Asian markets amid escalating Middle East tensions, with reports that Iran-aligned Houthi forces in Yemen had entered the conflict. Brent crude is also heading for a record monthly surge, raising concerns over inflation and global growth, further weighing on sentiment. Across the course, BYD Company dropped 4.9% after reporting its first annual profit decline in four years, pressured by weaker domestic demand and forex losses. Other notable laggards included Tencent Holdings (-2.4%), Pop Mart International (-0.6%), Meituan Class (-2.0%), Xiaomi (-1.9%), and SMIC (-2.1%). In contrast, PetroChina rose 2.8% on elevated oil prices and expectations of stronger earnings, reaching a multi-week high.

The Hang Seng Index fell 1.5% to around 24,589 on Monday, mirroring widespread losses across Asian markets as escalating geopolitical tensions and rising oil prices weighed on sentiment. The Iran war entered its fifth week with no clear resolution, with Iran-backed Houthi militants in Yemen opening a new front and the United States reinforcing its military presence, raising risks of prolonged conflict and potential energy supply disruptions. Higher crude prices lifted inflation expectations, driving bond yields and the US dollar higher, which pressured equities across the region. Separately, tensions between China and the United States increased after Beijing protested a US advisory regarding Hong Kong’s expanded national security rules, adding uncertainty around the regulatory environment and foreign participation. Notable laggards included Tencent Holdings (-0.4%), Meituan (-0.9%), Pop Mart International (-0.7%), and Semiconductor Manufacturing International Corporation (-1.22%).

The Hang Seng Index climbed 0.4% to close at 24,952 on Friday, outperforming most Asian markets as improving signals from China’s economy supported sentiment. Regional markets remained under pressure after Wall Street losses, as concerns over a prolonged Middle East conflict pushed oil prices higher and lifted global borrowing costs. Uncertainty around US-Iran developments also kept investors cautious. Despite these headwinds, stronger industrial profit growth in China pointed to improving earnings, reinforcing confidence in the recovery. Expectations of further policy support, including possible rate cuts and lower reserve requirements, added to the positive tone. Notable movers included Xiaomi Corporation (2.0%), Kuaishou Technology (1.4%), Shenzhen Xunce Technology (24.1%), Innovent Biologics (7.6%), and Akeso Inc. (1.9%).