Hong Kong stocks rebound and return to market focus: What signals are AI, tech giants, and southbound funds releasing?

After the initial adjustments, the Hong Kong stock market has recently regained vitality. The Hang Seng Index is once again challenging the 25,000-point level, with the Hang Seng Tech Index performing significantly better than traditional sectors, as AI, semiconductors, new energy, and internet giants take turns being active. For global investors, Hong Kong stocks are gradually shifting from being a "discounted market" to a "market with both growth and value attributes."

Meanwhile, as more digital asset users begin to pay attention to traditional financial markets, the connection between Hong Kong stocks and cryptocurrencies is becoming closer. Recently, Gate officially launched Hong Kong stock trading services, allowing users to participate directly in Hong Kong capital market investments through a unified account, providing a new channel for current Hong Kong stock market participation.

Why Hong Kong Stocks Are Once Again the Market's Focus

Over the past year, Hong Kong stocks experienced a prolonged period of valuation compression. Whether it’s internet platforms, financial stocks, or consumer leaders, most high-quality companies’ valuations are at relatively low levels historically.

However, since the second quarter of this year, market sentiment has gradually changed.

• Expectations of future Federal Reserve rate cuts have strengthened. Global funds are re-focusing on growth-oriented equity assets, and Hong Kong stocks, as one of the markets with relatively low valuations among major global markets, have naturally re-entered institutional focus.
• The profitability of Chinese tech companies continues to improve. Core internet giants like Tencent, Meituan, and Xiaomi all demonstrate strong cash flow and profitability, providing fundamental support for the market.

More importantly, the Hong Kong market has gathered a large number of Chinese new economy companies. From AI and large models to new energy vehicles, and advanced manufacturing and semiconductor industries, more and more emerging industry companies are becoming key components of Hong Kong stocks.

Therefore, this round of market rally is not just a simple technical rebound but also reflects a re-pricing of future industry development.

AI and Tech Stocks Lead This Rebound

If we look for the strongest theme in recent Hong Kong stock market activity, the answer is undoubtedly AI. The global AI industry chain remains in rapid development, with continuous capital market attention driven by demand for computing power, large model training, and AI agent applications.

In the Hong Kong market, AI themes mainly focus on several directions:

• AI infrastructure and computing power
• Semiconductors and advanced manufacturing
• Cloud services and internet platforms
• Intelligent terminals and robotics industry chain

Recently, chip companies like SMIC and Hua Hong Semiconductor have continued to attract funding. Meanwhile, tech manufacturing firms like Xpeng Motors, BYD, and Xiaomi benefit from the expected implementation of AI technologies. Tencent and Alibaba are also key players. As platforms with vast data and application scenarios, they are considered important beneficiaries of future AI commercialization. The market is re-evaluating the growth potential of these internet giants in the AI era.

From capital flow perspective, the technology sector has become a major driver of the Hang Seng Tech Index’s rise.

What Does Continuous Southbound Capital Inflow Signify?

Observing the Hong Kong stock market, a very important indicator is southbound funds. In recent years, mainland China funds have become one of the most significant sources of incremental capital for Hong Kong stocks. Compared to international capital, southbound funds often have a deeper understanding of Chinese business models and industry trends, making their flow often a market sentiment indicator. Recent data shows that southbound funds have been continuously net inflowing into Hong Kong stocks, with tech stocks, financials, and high-dividend assets being the most popular.

This phenomenon reflects two key signals:

• Valuation attractiveness still exists: even after the rebound, most core Hong Kong companies’ valuations remain below global peers.
• Long-term allocation demand is increasing: as global markets become more volatile, more funds are using Hong Kong stocks to allocate Chinese core assets.

Historically, when southbound funds flow in steadily, they tend to provide strong market support.

How Long Can the Valuation Rebound in Hong Kong Stocks Continue?

This is a question many investors care about most. From a valuation perspective, Hong Kong stocks have not yet returned to the high valuation range historically. Most internet platform companies still trade below their historical average P/E ratios, and some financial and consumer leaders remain at low valuation levels. From a profitability standpoint, most large companies are in an earnings improvement phase. Industry upgrades driven by AI, the development of the new energy supply chain, and gradual consumption recovery could be key drivers in the coming quarters.

Of course, the market still faces uncertainties. Changes in global interest rates, international capital flows, and macroeconomic conditions will influence Hong Kong stocks’ performance. Therefore, a more likely scenario is a structural market rather than a uniform rise across all sectors.

Key Hong Kong Stock Themes to Watch: From Tencent to CATL

For the current market, three main themes are worth focusing on:

First is AI and technology growth sectors: Tencent, Xiaomi, SMIC, and others remain market focal points.

Second is new energy and advanced manufacturing: CATL, BYD, and similar companies benefit from the global energy transition trend.

Third is high-dividend assets: China Mobile, HSBC, AIA, and other firms with stable cash flows continue to attract long-term capital.

From an asset allocation perspective, these three themes represent growth, manufacturing upgrades, and defensive attributes, covering different investment needs under various market conditions.

Gate Launches Hong Kong Stock Trading, Entering a New Phase of Global Investment Allocation

Image source: Gate Market Page

Against the backdrop of renewed market attention on Hong Kong stocks, the convenience of investment channels has become a key concern for users. On June 11, Gate officially launched Hong Kong stock trading services, further expanding its global stock investment platform.

After upgrading the Gate App to version 8.23.5 or above, users can directly participate in Hong Kong stock trading through the Gate stock interface without opening a traditional Hong Kong brokerage account or exchanging HKD, using USDT instead. The initial launch includes over 1,000 Hong Kong stocks, covering Tencent Holdings, HSBC, CATL, Xiaomi, Meituan, BYD, Ping An, AIA, Hong Kong Exchanges, and other core assets.

More importantly, Hong Kong stock trading shares a unified stock account system with existing US stock products. Users can manage both markets within the same account, enabling cross-market capital allocation and asset management. Currently, Gate supports trading over 10,000 US stocks and ETFs, with fractional trading as low as 0.01 shares. With Hong Kong market access, users can more easily build a global investment portfolio covering both the US and Hong Kong markets.

From a product ecosystem perspective, Gate has gradually formed a complete chain including Pre-IPO, IPO Access, and stock trading, providing users with multi-level investment opportunities from pre-listing to post-listing.

Hong Kong Stock Market Outlook: What Is the Market Trading?

Currently, the Hong Kong stock market is actually trading around three core logics:

• Valuation recovery driven by improved global liquidity.
• Revaluation of tech companies’ value amid the AI industry revolution.
• Capital inflows driven by China’s long-term competitive advantages.

For investors, the market may still experience volatility, but from industry trends and capital allocation perspectives, Hong Kong stocks are regaining global attention. As platforms like Gate expand traditional financial asset services, the barriers to participating in Hong Kong stocks are further lowered. Whether focusing on the AI wave, tech growth stocks, or high-dividend assets, Hong Kong stocks are becoming an important part of global asset allocation.

FAQs

What are the main drivers behind the recent rise in Hong Kong stocks?

Primarily driven by the AI industry heat, valuation recovery of tech stocks, continuous southbound capital inflows, and expectations of global rate cuts.

Which sectors are currently most watched in Hong Kong stocks?

AI, semiconductors, internet platforms, new energy vehicles, and high-dividend financials are the top sectors of market interest.

Which stocks does Gate support for Hong Kong stock trading?

Over 1,000 Hong Kong stocks are available initially, including Tencent Holdings, HSBC, CATL, Xiaomi, Meituan, China Mobile, and other major Hong Kong-listed companies.

How does Gate’s Hong Kong stock trading differ from traditional brokers?

Users do not need to open a separate Hong Kong brokerage account or exchange HKD; they can directly use USDT to invest in Hong Kong stocks, sharing a unified account with US stocks.

Will there still be investment opportunities in Hong Kong stocks in the future?

Based on valuation levels, industry upgrades, and capital flows, Hong Kong stocks still hold long-term allocation value. However, investors should pay attention to industry cycles and market volatility, and allocate assets reasonably.