This week, Hong Kong stocks rose first and then declined, with the Hang Seng Index surging before pulling back, ending the week up 1.65%.

On the news front, on Tuesday evening, the U.S. released its July CPI data, showing a year-on-year increase of 2.7%, lower than expected, which heightened market expectations for a Fed rate cut in September.

U.S. Treasury Secretary Besant stated, "If we had seen these revised non-farm payroll figures in May or June, I suspect the Fed might have already cut rates in June and July. This tells us that the likelihood of a 50-basis-point rate cut in September is very high."

Shortly after, the U.S. July PPI (Producer Price Index) data was released, with the year-on-year increase surging from 2.3% the previous month to 3.3%, the highest level since February this year and far exceeding the expected 2.5%. Month-on-month, July PPI rose 0.9%, the largest increase since June 2022, compared to expectations of 0.2% and a previous reading of 0%.

As a result, the market reduced bets on a September rate cut.

Domestically, a series of economic data was released this week. Notably, new RMB loans in July decreased by 50 billion yuan, compared to analysts' expectations of a year-on-year increase of 300 billion yuan. This marks the first decline in new loans since July 2005 and the largest monthly drop since December 1999.

In terms of housing prices, in July 2025, new home prices in 70 large and medium-sized cities declined month-on-month, while the year-on-year decline narrowed overall. However, the month-on-month decline of 0.31% in new home prices across these cities was the largest drop in eight months.

On the consumption front, July's total retail sales of consumer goods grew 3.7% year-on-year, the lowest level this year, down from 4.8% in the previous month. The growth in retail sales of home appliances, smartphones, and other categories driven by government subsidies slowed down.

Amid a series of negative factors, Hong Kong stocks surged before retreating.

However, with Chinese stocks reporting better-than-expected Q2 earnings, individual stocks performed remarkably. Among them, Hong Kong's stock king $Tencent Holdings (00700)$ delivered much stronger-than-expected Q2 results, with its stock price briefly reclaiming the HK$600 mark. $JD Health (06618)$ reported first-half revenue of RMB 35.29 billion, up 24.5% year-on-year, and operating profit of RMB 2.127 billion, up 105.5% year-on-year, driving its stock price up 12%.

By sector, information technology and healthcare led gains this week, while energy underperformed.

Southbound capital recorded a net inflow of HK$38.1 billion this week, with a notable HK$35.88 billion inflow on Friday alone.

Next week, star Chinese stocks like Xiaomi and Pop Mart will release earnings reports, and their post-earnings performance will be closely watched.