Sector-Specific Trends Dominate

The current Hong Kong stock market rally is primarily driven by sector-specific trends.

According to CICC's research report, while the Hang Seng Index has consistently found higher lows after each pullback, the leading sectors have rotated with each wave. Investors who fail to identify these sector leaders will miss out on index gains—highlighting that sector selection outweighs broad index performance.

A managing director at a top-tier investment bank told Beijing Business Today that the market remains sector-driven, with capital flocking to hotspots ranging from internet and AI to cyclical stocks and new consumer sectors. "The key is capturing the rotating sector leaders," he noted. "Picking the right sectors delivers index-level returns, but fixating solely on the index while ignoring these shifting leaders leads to underperformance."

From a macro perspective, Wang Hua, Investment Director at Yifang Capital, observed that Hong Kong's market "chips" have shifted in recent years, with capital increasingly favoring China-themed assets. As more A-share blue-chips list in Hong Kong, the market's appeal grows. "H-share valuations are rising, and investor interest is significantly higher than before," Wang said, predicting sustained demand for H-shares.

Statistics show 52 IPOs in Hong Kong this year (as of July 28), raising nearly HK$130 billion collectively. Among these, 10 are dual-listed A+H companies.

CATL leads with HK$41.06 billion raised—the world’s largest IPO in H1 2025 after its May 20 listing. It was followed by Hongrui Medicine (HK$11.37 billion), Sanhua Intelligent Controls (HK$10.74 billion), and Haitian Flavouring (HK$10.57 billion)—the only four IPOs exceeding HK$10 billion this year.