Hong Kong Stocks Have Nearly 90% Probability of Rising During National Day Period

Regarding this, Huatai Securities analysis stated that before the holiday, southbound funds saw significant inflows into consumer and defensive sectors; during the holiday, the market generally rose with growth and consumer sectors leading the gains; on the day after the holiday, most sectors pulled back, and the style shifted back to defensive, with the calendar effect dissipating within a week.

Huatai Securities indicated that according to the 2025 Hong Kong Exchange trading calendar arrangement, the Hong Kong stock market will be closed on October 1 (National Day) and October 7 (the day after the Mid-Autumn Festival). Southbound Stock Connect services will be suspended from October 1 to 8. In recent years, against the backdrop of continuous optimization of the Shanghai-Shenzhen-Hong Kong Stock Connect trading calendar, trading efficiency has been significantly improved. Since the China Securities Regulatory Commission and the Hong Kong Securities and Futures Commission jointly launched the trading calendar optimization mechanism in August 2022, it has effectively resolved trading obstacles caused by "both markets being trading days but not meeting settlement arrangements."

Specifically, in 2025, southbound trading is expected to add 8 trading days, including two additional trading days on September 29 and 30 before the National Day holiday. This optimized arrangement enhances the coverage of the Stock Connect for Hong Kong market trading days, providing investors with a more sufficient adjustment window for asset allocation before the long holiday.

Overall, there is a substantial net inflow of southbound funds before National Day. Considering the significant increase in the usage of the Stock Connect channel since 2018, Huatai Securities compiled statistics on the average daily net inflow scale and the proportion of net inflow to southbound holdings scale one day and one week before the National Day holiday since 2018.

In detail, except for 2024, which saw a significant net outflow of southbound funds due to short-term fluctuations in A-shares, all other years before National Day maintained relatively large-scale net inflows of southbound funds. Moreover, the proportion of net inflow showed a certain trend of widening year by year, reflecting that domestic institutions are increasingly inclined to continue flowing into Hong Kong stocks before National Day to seek returns.

The closer to National Day, the scale of net inflow and the ratio of inflow scale to the market value of southbound holdings increase significantly. The situation is similar this year. As of September 24, 2025, the average daily net inflow scale of southbound funds in the past week and past month were 6.92 billion and 8.28 billion yuan, respectively, with the proportions increasing by 0.06 and 0.07 percentage points year-on-year, respectively.