HSI down 1.65%
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The Hong Kong stock market as a whole presented a pattern of oscillating decline this week. The Hang Seng Index(HSI) fell 1.65% for the week, while the Hang Seng TECH Index(HSTECH) showed relative resilience, edging up 0.30%. The market’s operating characteristics were quite distinct. On one hand, high risk appetite in the A-share market and the sustained activity in certain tech sectors provided some mapping-driven momentum for Hong Kong’s tech assets. On the other hand, external liquidity pressure, local regulatory factors in Hong Kong, and pressure on heavyweight sectors at the index level collectively caused the Hang Seng Index to fail to extend its previous rebound momentum, keeping the overall HK market in a differentiated consolidation pattern.
From a macro perspective, the market this week remained in an environment of gaming between “external liquidity constraints” and “internal policy support.” Externally, the US core PCE price index rose 3.3% year-on-year in April, running at a high level. This has reinforced market expectations that the new Fed Chair Walsh might adopt a more hawkish policy stance, further pushing back the global market’s judgment on the timing of rate cuts. For the offshore HK stock market, a strong US dollar and high US Treasury yields continue to suppress valuations. Meanwhile, there are signs of a certain easing in China-US relations, with both sides releasing phased positive signals in the economic and trade sectors. Coupled with rising market expectations for progress in US-Iran negotiations, geopolitical risks have eased somewhat, providing a degree of support to market sentiment.
On the domestic policy front, signals for stabilizing growth and supporting industries continued to be released. The State Council issued the “15th Five-Year Plan for Urban Renewal,” clarifying key directions such as the renovation of dilapidated housing and old residential communities. This provides phased policy support for sectors related to infrastructure, building materials, property management, and the real estate chain. Meanwhile, the State Administration for Market Regulation released the “Guidelines for the Construction of AI Metrology System and Capacity,” which helps promote the standardization of the AI industry, strengthen the foundation for standardized industry development, and provide medium-to-long-term institutional support for AI-related companies with technical barriers and platform capabilities. Overall, the current HK stock policy environment features a combination of “marginal easing of external relations, internal growth policy support, and increased tech industry policy support,” which serves as an important foundation for the continued existence of structural market opportunities.
Industry sector performance showed extremely strong structural differentiation. Under the powerful resonance of the AI and hard-tech mainlines, some sectors surged against the trend. The most eye-catching performer this week was the Telecom-Cable/Satl Eqp(G4893IG.HK) sector, which soared 70.56% for the week, becoming the market’s strongest leading. Closely following was the Computer-Hardware/Perip(G3580IG.HK) sector, with a weekly gain of 43.17%, mainly driven by the acceleration of AI commercialization and the strong performance of leading companies like Lenovo Group in AI servers and PC businesses. In addition, the Bldg-Maintenance & Svc(G7340IG.HK) sector also performed remarkably, rising 30.53% for the week. Under the expectations of policy support and industry valuation repair, related industrial chains continue to receive high attention from capital.
On the US stock front, the strong performance continued this week, with the three major indices hitting new historical highs. The Dow Jones Indus Actual(0DJIA) rose 0.18% for the week; the Nasdaq Composite(0NDQC) rose 2.18%; and the S & P 500 Index(0S&P5) rose 1.21%. Although the high-inflation environment still constrains the market, the earnings performance, capital expenditure expansion, and commercialization prospects of AI giants continue to be the core forces supporting US stock risk appetite. The US market currently still exhibits a strong “tech leader-driven” characteristic, with index gains relying mainly on a few large tech companies continuously strengthening earnings expectations and industry narratives.
From the perspective of US macro and industry levels, the 3.3% year-on-year rise in core PCE in April shows that inflationary pressure remains sticky, further delaying market expectations for a shift in the Fed’s monetary policy. However, compared to macro-level disturbances, the market is clearly more focused on the expansion logic of the AI industrial chain. Nvidia announced it will increase spending on TSMC to $150 billion and launched a massive stock buyback; Meta is testing paid subscription services, continuously fueling expectations for AI commercial monetization; additionally, potential super IPO expectations for companies like SpaceX and OpenAI have further strengthened the imaginative space for US tech assets. Although oil prices fluctuated with the back-and-forth news of US-Iran negotiations, it has not yet had a substantial impact on the overall upward trend of US stocks.
The A-share market bottomed out and rebounded this week, with tech stocks continuing to act as the main leading force. The CSI 300(000300) rose 0.97% for the week. Market turnover remained at a high level of over 3 trillion yuan, indicating that risk appetite is still relatively strong and capital is clearly concentrating on the tech mainline.
Domestic fundamentals and policies also showed multi-point efforts this week. Data from the National Bureau of Statistics shows that from January to April, the profits of industrial enterprises above designated size increased by 18.2% year-on-year, with profits in electronic specialty material manufacturing surging by 601.7%, indicating a strong trend of industrial chain prosperity and profit improvement. On the policy front, the “15th Five-Year Plan for Urban Renewal” provides clear guidance for related industrial chains. On the industrial front, DeepSeek announced a permanent price reduction for its API, further stimulating market expectations for the speed of AI application implementation. Huawei proposed the “Tao Law,” strengthening market attention to the evolution of local semiconductor technology and innovation paths. The approval of ChangXin Memory Technologies’ STAR Market IPO and its plan for large-scale fundraising have also continuously boosted market confidence in the semiconductor domestic substitution mainline. Overall, the high activity of A-shares and the intensive release of industrial catalysts have also provided emotional and valuation spillover support for HK tech sectors.
In terms of portfolio performance, the HK33 portfolio underperformed the broader market this week, with an average weekly decline of 0.54%. Among the 33 constituent stocks, 13 stocks recorded gains and 20 declined. Notably, DONGYUE GROUP(00189), leveraging its position in the specialty chemicals sector, rose 20.15% for the week. Since its inception, the cumulative gain of this portfolio has consistently outperformed the Hang Seng Index (HSI), demonstrating the ability to generate excess returns by selecting quality assets during the HK stock valuation repair rally. The Model Portfolio performed relatively steadily this week, with an average weekly gain of 1.23%. CATL(03750) rose 8.53% for the week, highlighting the allocation value of model portfolios in a volatile market.
From a technical analysis perspective, the Hang Seng Index(HSI) is showing an oscillating consolidation pattern. The current price has fallen below the 5-day average price (-0.64%), 10-day average price (-1.32%), and 20-day average price (-2.72%), but is still running above the 50-day average price (-2.16%), indicating a weakening short-term technical pattern. The index’s lower support level has moved down to the 25,000-point integer mark, while the upper resistance level is near the one-year high of 28,056.1 points. The Hang Seng TECH Index(HSTECH) has a relatively better technical pattern; the current price is above the 10-day average price (+0.12%) but constrained by the 5-day average price (-0.31%). The key support for the medium-term trend is near the one-year low of 4,619.67 points.
In terms of capital flow, southbound funds overall showed a net inflow trend this week, with cumulative net purchases of approximately HK$808 million. Although the net inflow intensity was not large, southbound funds maintained net buying against the backdrop of overall pressure on HK stock indices, indicating that mainland investors still recognize the medium-to-long-term allocation value of core HK assets. Structurally, capital increased positions in tech leaders like Zhipu AI and SMIC, indicating that market funds are still concentrating their layout around the tech mainline. The marginal improvement in southbound funds has also provided a certain degree of bottom-line support for HK stock market sentiment.
Overall, the main theme of the global market this week remains the continuous game between “AI industry expansion” and “stubborn inflationary pressure.” HK stocks are seesawing between external liquidity constraints and internal policy support; while the index level is under pressure, structural opportunities remain active. Looking ahead, the market’s focus will continue to center on the policy path of the new Fed Chair Walsh, the subsequent evolution of US inflation data, and the pace of AI commercial application. If US Treasury yields continue to remain at high levels, global high-valuation growth assets may still face phased valuation suppression. However, if policy support continues and industrial trends persist, the HK stock market is still expected to breed new structural opportunities amidst the volatility. The market carries risks, and investment requires caution.
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published on May 29, 2026