Hong Kong Stocks Recover Despite Early Pressure

The Hang Seng Index rose 0.3%, or 68 points, to close at 24,020 on Monday, recovering earlier losses and following a 2.6% decline in the previous session. The rebound came despite pressure on rate-sensitive property and financial stocks, as elevated US Treasury yields and concerns over higher oil prices weighed on sentiment. Sentiment was supported by weaker-than-expected US employment data, which reduced expectations for another Fed rate hike this month, while Treasury yields eased. Semiconductor and Tech stocks led the gain, with Kingboard Laminates surging 11.9%, Z.AI Co. rising 6.2% and Lenovo gaining 4.7%. However, Brent crude remained around US$102 a barrel, keeping inflation concerns in focus. Trading was subdued as mainland Chinese markets remained closed for the National Day holiday. Meanwhile, Budweiser Brewing Company fell 2.1% after flagging a US$52 million withholding-tax charge. Hong Kong retail sales rose 2.9% year-on-year in August, the fastest growth in three months.

The Hang Seng Index declined 0.3%, or 66 points, to 23,908 on Monday, extending losses after plunging 2.6% in the previous session as elevated US Treasury yields and lingering concerns over higher oil prices weighed on sentiment. The decline came despite gains across most Asian markets after weaker-than-expected US employment data reduced expectations for another Federal Reserve rate hike this month, while Treasury yields eased from recent highs. Brent crude remained elevated at around US$102 a barrel, keeping inflation concerns in focus amid continued Middle East tensions. Trading was subdued as mainland Chinese markets remained closed for the National Day holiday. Tencent (-0.8%), AIA (-1.5%), Meituan (-1.1%) and Xiaomi (-1.4%) fell, while Kingboard Laminates (5.1%) and Lenovo (3.6%) rose. Meanwhile, stronger-than-expected Hong Kong retail sales provided a positive domestic signal, rising 2.9% year-on-year in August and fastest in three months, suggesting improving consumer demand.

The Hang Seng Index plunged 2.6%, or 641 points, to close at 23,972 on Friday, marking its largest one-day decline since March 2026, as a renewed selloff in global risk assets weighed on Hong Kong shares following the National Day holiday. The decline came amid elevated US Treasury yields, with the 10-year yield hitting 5.34%, its highest since 2002, as rising energy costs and strong AI-related investment fueled inflation and interest-rate concerns. Oil prices remained elevated, with Brent around US$102.6 a barrel over concerns on Middle East supply disruptions and China's suspension of refined-fuel exports. Technology stock remained under pressure amid higher yields and US restrictions on advanced AI hardware, while geopolitical tensions further dampened sentiment. The selloff was also amplified by the absence of Southbound Stock Connect flows as mainland markets remained closed. Notable laggards included Tencent (-2.3%), AIA (-6.0%), HKEX (-3.1%), Trip.com (-1.9%) and Xiaomi (-4.0%).