Hong Kong Stocks Climb as Xiaomi and Baidu Lead Tech Rally Amid Investor Focus on Fed’s Jackson Hole Meeting

Hong Kong stocks advanced on Monday, driven by a robust rally in technology shares, building on the biggest gain in two weeks recorded last Friday.

Investors are increasingly focusing on the upcoming earnings season and the potential for interest-rate cuts in the United States.

The Hang Seng Index gained 1.1 per cent, closing at 17,614.62 by the noon trading break. The Tech Index surged 2.5 per cent, while the Shanghai Composite Index saw a modest increase of 0.5 per cent.

JD Health International was among the top performers, soaring 7.5 per cent to HK$23.05. Its parent company, JD.com, also experienced significant gains, rising 5.8 per cent to HK$114 after reporting a near doubling of its quarterly profit despite facing heightened competition. Xiaomi saw a 2.8 per cent increase to HK$17.80 ahead of its earnings release scheduled for Wednesday, while search engine giant Baidu climbed 3.8 per cent to HK$86.95 in anticipation of its results on Thursday.

Investor attention is sharply focused on the Federal Reserve’s annual meeting set to take place this week in Jackson Hole, Wyoming. The meeting is expected to provide signals regarding a potential interest-rate cut next month. US stocks recorded their best week of the year after closing higher on Friday, easing concerns about a potential US economic slowdown that had spooked investors earlier in the month.

“The Hong Kong stock market has an opportunity to show short-term upwards momentum this week,” said Kenny Ng, a securities strategist at China Everbright Securities International. He noted that overseas markets have posted strong gains, and diminishing fears of a US recession have increased the likelihood of a rate cut in September.

Ng also highlighted that Hong Kong stocks are entering the earnings season, which will play a critical role in determining the market’s direction. Hong Kong Exchanges and Clearing is set to report its interim results on Wednesday, followed by insurance giant AIA on Thursday.

However, the gains were somewhat offset by losses in other sectors. Zhongsheng Group Holdings, a car dealer, fell 2.2 per cent to HK$9.38, deepening the stock’s year-to-date decline to 47.1 per cent. Hong Kong and China Gas also dropped 2 per cent to HK$6.37 after its interim earnings revealed challenges in gas demand.

Best Mart 360 Holdings resumed trading on Monday after a suspension on Friday afternoon following the arrest of its CEO Hui Chi-kwan by the Independent Commission Against Corruption on bribery allegations. The snack vendor’s shares initially plummeted as much as 13.5 per cent before stabilizing at HK$1.56.

Semiconductor and electronics equipment maker ASMPT saw a slight increase of 0.2 per cent to HK$85.80 after it was announced that the stock would be added to the 30-member Hang Seng Tech Index by the index compiler Hang Seng Indexes Company.

Meanwhile, China’s National Council for Social Security Fund, the country’s pension manager, announced on Monday its commitment to increasing investments in strategic and innovative sectors, following recent government pledges to bolster economic recovery.

In the broader region, Japan’s Nikkei 225 fell by 1.1 per cent, South Korea’s Kospi declined 0.4 per cent, while Australia’s S&P/ASX 200 inched up by 0.1 per cent.

By fLEXI tEAM