On the morning of August 12, the Hang Seng Tech Index fluctuated lower before narrowing its losses. The largest A-share ETF tracking the Hang Seng Tech Index (513180) saw a slight decline, with holdings such as Kingdee International, Kuaishou, Bilibili, and Horizon Robotics leading the losses, while BYD Electronic, SMIC, and NIO were among the top gainers.
In its latest research report, China Merchants Securities pointed out that the Hong Kong stock market may enter a phase of volatility in the short term, with August being a key period to watch for potential catch-up opportunities in tech stocks. Specifically, under the current environment of weak/steady economic recovery, liquidity-driven factors remain a key feature of the stock market, with changes in risk appetite dictating market trends. Short-term expectations for domestic policy support have cooled. Regarding USD liquidity, market expectations for Fed rate cuts will be adjusted based on July and August inflation data, August employment figures, and the Jackson Hole symposium in late August, which could lead to increased volatility in the USD index. Given the currently elevated sentiment in the Hong Kong market, heightened external volatility may trigger a period of fluctuations.
Structurally, the institution believes that the recent underperformance of Hong Kong's tech sector, coupled with the market's pricing-in of profit pressures from intensified competition among internet platform companies, sets the stage for a potential rebound. The mid-August earnings releases of leading tech companies, particularly their financial and innovation metrics, could serve as catalysts to validate AI-driven growth and ignite a new tech rally. Investors may focus on catch-up opportunities in undervalued sectors like the Hang Seng Tech Index.
Year-to-date, southbound funds have recorded a net inflow of over HK$900 billion, primarily targeting core assets like AI and new consumer sectors. These two themes reflect the growth trajectory of emerging industries and their relative scarcity, likely attracting further capital inflows and sustaining the positive momentum in Hong Kong stocks. Public data shows that the Hang Seng Tech Index ETF (513180) tracks 30 leading Hong Kong-listed tech firms spanning both software and hardware, with components deeply embedded across the AI supply chain. Companies like Alibaba, Tencent, Xiaomi, Meituan, SMIC, and BYD are poised to become China's "Tech Magnificent Seven." Investors without access to the Stock Connect may use the Hang Seng Tech Index ETF (513180) as a one-click tool to gain exposure to China's AI core assets.
