Hong Kong Stocks Sink to One-Year Low

The Hang Seng Index fell 335 points, or 1.4%, to close at 23,077 on Thursday, retreating from gains in the previous session and touching its lowest level since May 2025, as investors remained cautious ahead of Hong Kong's trade balance data. Still, losses were partly tempered by strength in technology shares after Micron Technology issued a stronger-than-expected forecast and highlighted robust AI-driven demand for memory chips, boosting sentiment across the semiconductor sector. Meanwhile, lower oil prices, driven by signs of increasing supply and progress in US-Iran peace negotiations, helped ease inflation concerns. Investors also monitor strong southbound inflows from mainland China, which have been supporting Hong Kong equities amid a revival in IPO activity. Notable losers included Tencent (-1.7%), Meituan (-2.4%), Xiaomi (-2.9%), Sunny Optical Technology (-11.7%), and Trip.com (-10.9%).

The Hang Seng Index rose about 0.3% to close at 23,412 on Wednesday, snapping a five-day losing streak, as bargain hunting emerged after the index's recent underperformance. Improved risk sentiment also supported the market after signs of progress in US-Iran peace talks eased concerns over potential disruptions to global energy supplies. Lower oil prices further helped reduce inflation worries and boosted appetite for risk assets across markets. Investor sentiment was further underpinned by continued enthusiasm for artificial intelligence and semiconductor-related investments. Demand for AI exposure remained strong after a leveraged ETF linked to SK Hynix became Hong Kong's largest ETF by assets. However, gains were capped by caution over US interest rates and concerns about the pace of China's economic recovery. Notable movers included SMIC (+8.9%), Tencent (+3.4%), Knowledge Atlas (+0.2%), Kingboard Laminates (+7.2%), and Xiaomi (+1.5%).

The Hang Seng Index plunged 1.8% to close at 23,336 on Tuesday, extending losses from the previous session as concerns over global interest rates outweighed support from easing geopolitical tensions. Sentiment was underpinned by signs of progress in US-Iran peace talks, which helped keep oil prices near recent lows and supported risk appetite across Asian markets. However, investors remained cautious after the Federal Reserve signaled that borrowing costs could stay elevated for longer amid lingering inflation pressures. Regional sentiment was mixed, with equities struggling for direction after Wall Street ended mostly lower despite a sharp drop in crude prices. Investors also monitored developments in Hong Kong's IPO market and the upcoming release of locked-up shares, which could add to market volatility in the coming weeks. Among notable losers included Tencent (-4.2%), SMIC (-1.3%), Kingboard Laminates (-5.1%), Knowledge Atlas (-9.9%), and Xiaomi (-4.6%).