In August, the three major indices of the Hong Kong stock market continued to strengthen after hitting bottom at the beginning of the month. As of the close on August 30th,$Hang Seng Index (800000.HK)$it has accumulated a 3.72% increase this month, and during the same period,$Hang Seng TECH Index (800700.HK)$And.$Hang Seng China Enterprises Index (800100.HK)$they have increased by 1.24% and 3.67% respectively.

Specifically, the Hong Kong stock market encountered the so-called 'Black Monday' at the beginning of this month, which was closely related to the general sluggishness of global stock markets and the volatility of the yen carry trade. However, the Hong Kong stock market demonstrated strong resilience, quickly rebounded from the bottom, and has since experienced steady growth for four consecutive weeks.

Market analysis believes that the recent expectation of rate cuts by the Federal Reserve has been increasing, and the attention to the Hong Kong stock market has significantly increased. In the view of many public funds, as the Federal Reserve enters a rate-cutting cycle, the US dollar index and US bond yields are expected to accelerate their decline. According to historical performance, Hong Kong stocks and precious metals performed well during previous rate-cutting periods by the Federal Reserve in major asset classes.

Futu News has compiled some of the September Hong Kong gold stocks from various institutions for the reference of mooers.

In addition, GTJA also mentioned that after the dovish statement by the Federal Reserve, the market reacted positively and US stocks collectively rallied. The US dollar and US bond yields weakened, which provided a positive factor for the liquidity of Hong Kong stocks. The current valuation of Hong Kong stocks has fully priced in the previous pessimistic factors, and the risk premium implies a higher return on investment. In addition, foreign investment's allocation scale to Hong Kong stocks is at a low level, and there is a large potential for future inflows. In addition, combined with the opening of the domestic policy space due to the Federal Reserve rate cuts, we are more optimistic about the subsequent performance of the Hong Kong stock market.

Huatai Fund also believes that the Federal Reserve rate cuts, combined with the recent appreciation of the renminbi, are a major boost for the Hong Kong stock market, as Hong Kong stocks are greatly affected by global liquidity and market risk preferences.

On the one hand, the domestic economy has shown a bottoming out and recovery trend, with a series of favorable policies boosting domestic demand and accelerating infrastructure investment, thereby boosting market confidence. On the other hand, the improvement in global market liquidity means that more funds may be reinvested in markets that still have relatively low valuations but have potential, such as the Hong Kong stock market. In the rate-cutting cycle, the domestic policy space may be further opened, which is conducive to more capital flowing into Hong Kong stocks.

Huaxia Fund further analyzes that the risks of the Hong Kong stock market have been fully released and the value of allocation is highlighted. Opportunities can be grasped from three directions: First, the upward potential of the Hong Kong stock technology sector, such as the internet-related sector, with positive performance realization, sensitivity to overseas interest rates, and large room for upward recovery in previously stagnant sectors. Second, the high dividend yield sector of Hong Kong stocks, with the downward centralization of government bond yields and the possible exemption of dividend taxes, has more allocation value for medium- to long-term funds. Third, the broad-based Hong Kong stock market, the Hang Seng Index is expected to benefit from improved liquidity, valuation recovery, and overall performance expectations of Hong Kong stocks.

Editor/ping