Hong Kong and China Stocks Rise, Driven by AI and Tech Momentum
Stocks in Hong Kong and China climbed on Thursday, boosted by gains in technology and artificial intelligence (AI) shares. Analysts noted that Hong Kong-listed tech firms are still under-represented in global AI-focused investment strategies.
Tech Shares Lead the Rally
China’s main stock indices posted modest gains. The CSI300 Index and the Shanghai Composite Index both rose by 0.2%. Meanwhile, the Hong Kong Hang Seng Index saw a more notable increase of 1.1%.
Hong Kong’s technology sector stood out, with the Hang Seng Tech Index gaining 1.9%. This performance tracked the overnight rise of Chinese tech American Depositary Receipts (ADRs) listed in New York. Onshore, the China Software and IT Index increased by 2.3%, reflecting investor optimism in the sector.
Analysts from Huatai Securities highlighted technology as a key investment theme, pointing to underinvestment in Hong Kong tech firms. They also described Hong Kong’s equity market as a strategic asset for global investors. It can serve as a useful diversification tool and a potential hedge against US dollar fluctuations.
“As future global productivity depends heavily on AI advancements, companies best positioned to lead this trend are mainly found in the US and Hong Kong,” the analysts said.
Hong Kong Fintech and Rare Earth Stocks See Gains
The CSI Internet Finance Index rose by 2.3% as investors shifted focus to fintech following Hong Kong’s approval of a stablecoin bill last month. The new regulation has drawn attention to digital financial opportunities in the region.
Additionally, the CSI Rare Earth Index gained 0.8%. This came after a US auto supplier group urged immediate action on China’s restricted exports of rare earth materials. These resources are vital for producing auto parts and magnets, and the trade limits could affect manufacturing operations.
Services Sector Growth Eases Trade Concerns
A private survey showed that China’s services activity grew at a slightly faster pace in May. Domestic new orders rose, but export demand fell due to ongoing concerns over US tariffs. Despite this mixed picture, investor sentiment remained largely positive.
with inputs from Reuters