Hong Kong's three major stock indices all closed lower in the morning session. By the midday break, the Hang Seng Index had declined by 0.81% to 25,048.57 points, the Hang Seng Tech Index fell by 1.23%, and the Hang Seng China Enterprises Index was down 0.41%.
Across the market, technology and internet stocks were broadly weaker, with Lenovo Group Ltd shares dropping more than 5% and Baidu Inc shares down over 1%. The telecommunications sector bucked the downward trend, with ZTE Corporation (HKEX: 00763) shares surging more than 8%. The semiconductor sector experienced a pullback, with shares of Montage Technology Co Ltd falling over 7%. Gaming stocks weakened, with Wynn Macau Ltd shares declining more than 4%.
Telecoms Sector Bucks the Trend
The telecommunications sector moved against the broader market decline. Shares of ZTE Corporation advanced more than 8%. This movement followed a notice issued by the General Office of the Ministry of Industry and Information Technology regarding the launch of a pilot action for coordinated ministry-province development of 6G innovation. The notice mentioned that by 2029, through this initiative, the aim is to further stimulate innovation vitality among local governments and enterprises, develop a batch of independently innovative 6G technology solutions, cultivate a number of promising new business application scenarios, and see the emergence of a variety of new terminal products, thereby providing strong support for the commercial deployment of 6G.
Semiconductor Stocks Retreat
The semiconductor sector saw a pullback during the session. Shares of Montage Technology dropped more than 7%. This followed a mostly lower session for U.S. chip stocks overnight, with the Philadelphia Semiconductor Index closing down over 2%. Broadcom Inc shares plunged more than 12%, and Micron Technology Inc shares fell over 7%. Broadcom's latest revenue figures came in slightly below market expectations, casting a shadow over the AI investment boom that has been driving markets and leading investors to reassess whether future growth expectations for AI infrastructure investment have already been priced in.
Gaming Stocks Weaken
Gaming stocks showed weakness. Shares of Wynn Macau fell more than 4%. With the 2026 FIFA World Cup scheduled to take place from June 11 to July 19, both Morgan Stanley and JPMorgan have noted that the event may temporarily divert the time and funds of high-end players, putting pressure on gaming revenue for June and July. Morgan Stanley forecasts June's gross gaming revenue to be around MOP 20.8 billion, representing a year-on-year decrease of 1%, which would imply second-quarter GGR growth of only 4% year-on-year.
Comments