Hang Seng Tech surges, potentially the largest single-day increase in nearly 4 months! Zhang Yidong: Hong Kong stocks still have new highs in the second half of the year

Ask AI · How did the U.S.-Iran negotiations unexpectedly boost sentiment in the Hong Kong stock market?

On April 8, Trump’s “final ultimatum day” saw an about-face. The two sides of the U.S. and Iran entered substantive negotiations, boosting sentiment in the Hong Kong stock market and sparking a major rebound from low levels. Hang Seng Tech opened strong and kept rising, up 3.9% at one point. If the close maintains its strength, it is expected to set the biggest single-day gain in nearly four months. The secondary-market price of the Huaxia Hang Seng Tech ETF (159101.SZ) linked to Hong Kong Connect Tech also jumped sharply. Among its holdings, Hua Hong Semiconductor rose more than 12%; Semiconductor Manufacturing International, Kingsoft Cloud, and SenseTime rose more than 7%; and Meituan and Xiaomi rose more than 4%.

Since the start of the year, the performance of Hong Kong’s technology stocks has diverged from that of the Hang Seng Index. Hang Seng Tech is down 15% year-to-date, and the Guozheng Hong Kong Connect Tech Index is down 13% over the same period, while the Hang Seng Index is only down 2% during the same timeframe.

Zhang Yidong, Chief Economist at Haitong International, pointed out that whether in A-shares or Hong Kong stocks, the market volatility since the start of the year is like “fire at the city gate that affects the fish in the pond”—it doesn’t change the long-term trend. In the second half of the year, there is hope to hit new highs within the year. A period of choppy consolidation is more like accumulating energy and preparing to launch; crouching down can actually help you jump higher.

On portfolio allocation priorities, Zhang Yidong recommends: before a ceasefire, gold, energy, and resources are the top choices. After a ceasefire, within safe assets, he suggests keeping only gold; for more allocations, you can consider high-tech, hard technology, and advanced manufacturing.

A-share investors can gain exposure to undervalued rebound opportunities in Hong Kong tech assets by going through relevant ETFs, such as the Huaxia Hang Seng Tech ETF (159101.SZ). With a low entry threshold, diversified risk, and support for T+0 trading, it is also suitable.

The Huaxia Hang Seng Tech ETF (159101.SZ) passively tracks the Guozheng Hong Kong Connect Tech Index. Compared with the Hang Seng Tech Index, it covers a wider range of Hong Kong characteristic tech assets. By combining four major core asset groups—internet software applications (such as Tencent, Alibaba, and Meituan) + semiconductors (such as Semiconductor Manufacturing International and Hua Hong Semiconductor) + China’s advanced manufacturing (BYD Company Limited, Li Auto, XPeng, and UBTech) + innovative drugs (such as BeiGene, CanSino Biologics, and Sinopharm/Innovent)—it is a bottom-holdings choice for building a stake in Hong Kong’s tech “new quality productive forces.”

China Daily Economic News