On April 2, Hong Kong's stock market saw net buying of HK$19.828 billion by northbound capital. Specifically, the Shanghai-Hong Kong Stock Connect recorded net purchases of HK$11.084 billion, while the Shenzhen-Hong Kong Stock Connect saw net buying of HK$8.744 billion.
The top stocks by net northbound inflows were the Tracker Fund (02800), the Hang Seng China Enterprises Index Fund (02828), and Xiaomi Corporation-W (01810). In contrast, the most heavily sold stocks were CNOOC (00883), Alibaba Group Holding-W (09988), and Yangtze Optical Fibre and Cable (06869).
Northbound capital increased holdings in Hong Kong ETF products, with the Tracker Fund (02800) and the Hang Seng China Enterprises Index Fund (02828) receiving net inflows of HK$8.546 billion and HK$2.593 billion, respectively. Analysts at Bocom International noted that March's market volatility in Hong Kong was primarily driven by geopolitical uncertainties in the Middle East rather than fundamental factors. They suggested that if tensions do not escalate further in April, accumulated risk premiums may gradually unwind, creating room for valuation recovery in the market. The upcoming meeting between the Chinese and U.S. heads of state is expected to be a key focus for market sentiment. Combined with the gradual dissipation of technical pressures from annual reports and share lock-up expiries in April, Hong Kong stocks may transition from a phase of high volatility toward stabilization and bottoming-out.
Xiaomi Corporation-W (01810) received net inflows of HK$1.115 billion. According to Lanjing Technology, sources familiar with the matter revealed that Song Gang, former vice president of production at Tesla's Shanghai Gigafactory and a key figure in its construction and capacity ramp-up, will join Xiaomi's automotive division. On April 1, CEO Lei Jun disclosed on Weibo that the new SU7 model, which began deliveries on March 23, had already delivered over 7,000 units in March.
Technology stocks showed mixed performances. Tencent (00700) attracted net buying of HK$657 million, while Alibaba Group Holding-W (09988) saw net outflows of HK$248 million. HSBC released a research report stating that the AI monetization capabilities of both Alibaba and Tencent are systematically undervalued. The bank noted that market confidence remains in the long-term return on capital expenditure and the sustainability of free cash flow and balance sheets for both companies. The primary concern, however, is the rising operating expense ratio due to consumer-side AI investments. If the two companies can capture additional market share in the advertising sector, their revenues could see an upside of up to 11% by 2027.
Geely Automobile (00175) recorded net inflows of HK$427 million. On April 1, the company reported cumulative sales of 709,358 vehicles in the first quarter of 2026, a record high for the period. March sales alone reached 233,031 units, up 13% month-on-month. New energy vehicle sales during the quarter totaled 369,059 units, with a penetration rate of 52%, rising further to 55% in March. Overseas exports reached 203,024 units, a year-on-year increase of 126%, significantly outpacing overall sales growth.
CNOOC (00883) again faced net selling of HK$734 million. Former U.S. President Donald Trump stated in a speech that the U.S. military had achieved a swift and decisive victory, with core strategic objectives nearly accomplished, and indicated that intense military strikes against Iran would be launched within the next two to three weeks. Ping An Securities noted that geopolitical risks involving Iran remain elevated, while the Russia-Ukraine conflict continues to pose uncertainties. In the short term, oil prices are expected to find strong support around $85 per barrel.
Additionally, Shandong Molong (00568) and SMIC (00981) received net inflows of HK$93.13 million and HK$16.74 million, respectively. Meanwhile, Yangtze Optical Fibre and Cable (06869) saw net outflows of HK$240 million.
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