The Hong Kong stock market today showed a weak trend due to the impact of external market turmoil. The Hang Seng Index and the Hang Seng China Enterprises Index closed down by 1.1% and 1.12% respectively, both experiencing a three-day decline, while the Hang Seng Tech Index fell by 0.39%.

Let's take a look at today's market hotspots: core technology stocks are mixed, with the Hang Seng Index falling for three consecutive days and breaking through key levels; concerns about a recession causing overseas market volatility, with resource stocks leading the decline in the short term; and the warming of interest rate cut expectations leading to frequent counterattacks in the pharmaceutical sector.

【Core technology stocks are mixed, and the Hang Seng Index falls for three consecutive days and breaks through key levels】

On the market, core technology stocks showed mixed performance, with Xiaomi falling by nearly 3%, while Baidu, Tencent, and Netease declined, and Kuaishou rose by nearly 2% and JD.com rose by about 1%.

In other sectors, the sharp drop in oil prices overnight has weakened petroleum stocks, and the pressure on the US dollar has been bearish for gold stocks. Infrastructure sectors beginning with middle letters are continuing to decline, with coal, shipping, wind power, consumer electronics, and gaming industries all declining together.

The sectors that rose include the active biomedical stocks, with a few gains in the pork sector. Auto and tourism stocks are relatively resistant to the decline.

Overall, the short-term sentiment of the Hang Seng index has weakened, with the rebound coming to an end after three consecutive declines, breaking through the fiercely contested 17500 level. The Hang Seng Index had a total turnover of 96.982 billion Hong Kong dollars today, with a total short selling amount of 11.053 billion Hong Kong dollars, accounting for 11.40% of the total, a slight increase.

Meituan-W, HSBC Holdings, and Xiaomi Group-W ranked the top three for short selling amounts, with HK$0.696 billion, HK$0.572 billion, and HK$0.504 billion respectively.

Concerns about recession have caused market volatility in overseas markets, with resource stocks leading the decline in the short term.

In terms of market conditions, resource stocks led the decline today, especially as concerns about economic recession have resurfaced, leading to increased volatility in overseas markets and suppressed commodity market conditions.

In the futures market, copper, aluminum, and other major industrial metals are facing poor market performance, with continuous inventory increases affecting all market participants to remain cautious.

According to feedback from traders, the current situation of downstream orders in the non-ferrous industry has not significantly improved. Due to weak fundamental demand, buyers in the market have a strong mindset of pressing down prices.

In addition, today's stock markets in Japan and South Korea fell sharply, further strengthening recession expectations. The Japanese stock market, due to exchange rate risks, has caused concerns in the market about corporate financial reports, and financial stocks have experienced selling pressure.

Various indicators indicate that the short-term market operation is increasingly affected by the expectation of a rate cut by the Federal Reserve in September.

According to Bank of America analysis, the non-farm payroll report to be released this week has become the most important economic indicator for the US stock market, and the underlying logic behind it is the game of economic recession and rate cut expectations.

According to Morgan Stanley's chief US stock strategist, if the non-farm payroll data released this Friday further proves the resilience of the economy, stocks that have lagged behind in the rebound of the US stock market may get a boost.

For the Hong Kong stock market, as the strong performance of China Mainland banking stocks comes to an end, the market has entered a vacuum period without a leading theme, and the impact of overseas markets, especially the US stock market, deserves more attention.

【Expectations of interest rate cuts rise, pharmaceutical sector frequently counterattacks】

On the other hand, the pharmaceutical sector, as a type of stock that benefits from interest rate cuts, is once again trending upwards against the market.

According to CME's "Fed Watch" data, there is a 60% chance of a 25 basis point interest rate cut by the Federal Reserve in September. Currently, it is widely believed that if the Federal Reserve cuts interest rates, risk appetite will increase, and innovative drugs with higher growth potential may receive more favor from risk capital in the medium term, providing upward momentum.

It is worth noting that, based on historical data, the innovative drug index has a clear negative correlation with Federal Reserve interest rates.

According to a report released by Haitong Securities this week, some funds that have reallocated to Hong Kong stocks in the pharmaceutical and biotech sector have shown relatively better performance in August, and this trend is also worth monitoring.