Hong Kong stocks suffered heavy losses on Thursday, with the Hang Seng Index falling over 3% and dropping below 19,000 points. This marked a one-month low since early June. The Hang Seng Technology Index also fell 1.69% and dropped below 4,000 points, hitting a new low for the week.
The turnover of the Hang Seng Index slightly increased to 97.291 billion from the previous trading day’s 86.888 billion. Despite the sharp drop, Southbound funds from Beishui continued to search for bottoms, with a net purchase of 3.228 billion yuan and a net inflow of 4.43 billion yuan.
The decline in Hong Kong stocks followed the release of the Federal Reserve meeting minutes on Wednesday. The minutes indicated that almost all policymakers expected to raise interest rates further this year, causing US stocks to close down. The hawkish US monetary policy outlook negatively impacted Asian markets, including Hong Kong. Additionally, concerns over geopolitical tensions in the chip field between major powers intensified, further contributing to the market downturn.
However, analysts remain optimistic about the future of Hong Kong stocks. Guosen Securities stated that despite ongoing rate hikes in the US, the economic cycle is in an expansion period, and corporate profits are expected to improve month-on-month. Foreign investors have low expectations, leading analysts to believe that the rate hike will not further suppress Hong Kong stocks. Guosen Securities predicts that Hong Kong stocks may begin to rise in the third quarter.
At the close of the market, the Hang Seng Index dropped 3.02% to 18,533.04 points, while the Hang Seng Technology Index fell 1.69% to 3,948.82 points. Various sectors witnessed declines, including insurance stocks, real estate stocks, gaming stocks, mainland banking stocks, rare earth mining stocks, consumer stocks, mainland real estate stocks, and internet stocks.
Amidst the market downturn, insurance stocks such as AIA and Prudential fell around 4%. Real estate stocks, including Sun Hung Kai Properties, Cheung Kong, Henderson Land, and Sino Land, dropped over 2%. Gaming stocks, led by Sands China, fell more than 5%, and banking stocks, such as China Merchants Bank and China Construction Bank, fell over 3%. Rare earth mining stocks registered declines, with China Rare Earth falling 9.6% and Chalco, Jiangxi Copper, and Zijin Mining falling over 3%. Consumer stocks, such as China Resources Beer, Anta Sports, Haidilao, and Jiumaojiu, fell more than 4%. Mainland real estate stocks, including China Resources Land, Country Garden, and Longfor Group, fell more than 2%. Internet stocks like Meituan, Tencent Holdings, and Alibaba also experienced declines.
In addition to these sectors, most industries, including pharmaceutical stocks, gas, and movies, also witnessed a general decline.
Goldman Sachs released a report analyzing Chinese bank stocks, denying previous claims of a concentrated bearish view. The report, titled “Testing the ‘Impossible Trinity,'” covers 12 banks and offers sell, buy, and neutral ratings.
Despite the current market situation, investors and analysts remain hopeful for the future of Hong Kong stocks, citing potential improvements in corporate profits and low foreign investor expectations as key factors.