Hong Kong Stocks Edge Lower

The Hang Seng Index was little changed to close at 25,495 on Wednesday, recovering from an earlier decline as HKEX shares gained 1.6% to HK$411.40 following the exchange operator’s strong first-half results. Revenue rose 19% year-on-year, attributable profit increased 24%, and the interim dividend was lifted 24%, providing support to market sentiment. At the same time, Hong Kong and China Gas climbed after posting a 23% increase in first-half profit, helping support the broader market. Still, gains were capped by a cautious global backdrop, with investors digesting a selloff in technology shares, elevated US Treasury yields, higher oil prices, and renewed Middle East tensions that weighed on risk appetite across Asian markets. Notable movers included Xiaomi (5.1%), Tencent (0.9%), and Meituan (1.9%). In contrast, SMIC and China Unicom declined 4.6% and 12.8% respectively.

The Hang Seng Index edged down 0.4%, or 96 points, to 25,372 on Wednesday, as investors remained cautious following a selloff in US technology shares, elevated bond yields, rising oil prices and renewed Middle East tensions. In Hong Kong, Baidu plunged 14.4% to HK$86.50, its lowest level in a year, after reporting a 4% year-on-year decline in second-quarter revenue to RMB31.33 billion, below analysts’ expectations. Meanwhile, China Unicom fell around 10% after reporting a 34.6% drop in first-half net profit to RMB9.5 billion, despite a 0.6% increase in operating revenue. Tencent (-0.7%), SMIC (-1.4%), Lenovo (-1.2%) and Kingboard Laminates (-3.4%) also declined, while Xiaomi gained 4.4%. On the policy front, China’s financial regulator approved allowing mainland insurance funds to invest in Hong Kong-listed ETFs through Stock Connect, potentially providing additional institutional capital for Hong Kong equities. Investors are also awaiting HKEX’s interim results announcement today.

The Hang Seng Index was little changed, edging up 0.1% to close at 25,471 on Tuesday, after fluctuating between gains and losses during the session as market participants weighed renewed geopolitical uncertainty and higher oil prices against continued interest in Chinese tech and semiconductor stocks. Brent crude climbed above $91 a barrel after the US-Iran ceasefire expired, fueling concerns that higher energy costs. A mixed overnight performance on Wall Street also weighed on sentiment. Among individual stocks, Xiaomi remained in focus ahead of its quarterly earnings after the strong results could extend the company's best quarterly share-price rally in more than a year, provided it reassures investors that rising material costs are coming under control. Meanwhile, sentiment remained restrained following weaker-than-expected July economic data from China released a day earlier. Notable laggards were Z.AI Co. (-13.3%) and MiniMax (-5.0%), while SMIC (0.9%) and Xiaomi (1.2%) gained.