Hong Kong stocks adjust.

At the morning opening, Hong Kong stocks saw adjustments. The Hang Seng Index and the Hang Seng Tech Index both fell, with the Hang Seng Index dropping over 3% and the Tech Index falling over 6%.

The A50 Index futures also showed a downward trend.

In terms of individual stocks, mainland real estate stocks plummeted with many stocks dropping over 10% straight down. Sunac fell over 22%, Country Garden fell, Shimao Group, CIFI Holdings Group all dropped over 21%, China Jinmao, Sino-Ocean Group dropped over 17%.

Most China-affiliated brokerage stocks declined, with Orient falling over 13%, Citic Securities falling over 11%, Everbright Securities, China International Capital Corporation falling over 8%.

Automobile stocks and network technology stocks collectively pulled back, with Evergrande Vehicle falling over 17%, Xpeng falling over 10%, Nio Inc falling over 9%; KE Holdings falling over 12%, Bilibili, JD.com dropping nearly 9%.

Previously, the Hang Seng Index had risen continuously by over 30%, while the Hang Seng Tech Index had even surged over 50%.

Market research institutions: There is still room for growth.

Last night, in the U.S. stock market, the performance of ETFs tracking Chinese assets was particularly strong, with the 3x-long FTSE China ETF-Direxion (YINN) rising by 21.81% and the 2x-long CSI 300 ETF-Direxion (CHAU) rising by 15.23%.

Zhang Jintao, Director of Jia Shi Fund's Value Style Investment, pointed out that from a global market valuation attractiveness and fund rebalancing perspective, A-shares and high-quality assets in Hong Kong have a strategic advantage. For example, China's leading internet companies are undervalued globally, and if foreign capital returns, they may prefer to buy these types of high-quality assets with certain growth prospects and good competitive positioning. With overseas risk-free interest rates declining, undervalued and high-dividend Chinese assets are more attractive, and Hong Kong stocks are expected to be the preferred choice for global fund allocations into Chinese assets.

Market research institution DataTrek Research stated that, if history is any guide, there may still be significant room for this uptrend.

The institution mentioned that comparing the relative performance of iShares Core MSCI China Index ETF (FXI) and SPDR S&P 500 Index ETF Trust (SPY) within a 100-day time frame, during years such as 2009, 2015, and 2023 with positive policy shifts, Chinese stocks outperformed U.S. stocks by over 30 percentage points, while currently only leading by 13 percentage points.

Editor/Lambor