Northbound trading in the Hong Kong stock market recorded a net selloff of HK$9.218 billion on October 22, according to data. Of that total, the Shanghai Stock Connect recorded a net selloff of HK$3.225 billion, while the Shenzhen Stock Connect recorded a net selloff of HK$5.993 billion.
The stocks that drew the largest northbound net buying were Tencent (00700), Realord Group Holdings (01196) and CSOP Hang Seng TECH Index ETF (03033). The stocks that saw the largest northbound net selling were Alibaba-W (09988), SMIC (00981) and Hua Hong Semiconductor (01347).
Among the actively traded stocks on the Shanghai Stock Connect and the Shenzhen Stock Connect, Tencent (00700) and CSOP Hang Seng TECH Index ETF (03033) attracted net buying of HK$489 million and HK$192 million respectively, while Alibaba-W (09988) suffered a net selloff of HK$1.676 billion.
Shenwan Hongyuan said in a research note that the recent sharp divergence between the performance of the Hang Seng TECH Index and U.S. software stocks may be related to valuation constraints from rising U.S. Treasury yields and differences in earnings expectations between the two technology sectors. If earnings dynamics dominate in the future, U.S. software stocks could move back toward the Hang Seng TECH Index; if discount rates dominate, then as interest rate pressures ease, the Hang Seng TECH Index may move closer to U.S. software stocks.
Kingboard Laminates (01888) and YOFC (06869) suffered net selloffs of HK$189 million and HK$382 million respectively. Meta raised its full-year 2026 capital expenditure forecast to US$135 billion to US$145 billion, while Tesla cut its full-year 2026 capital expenditure target to about US$20 billion from more than US$25 billion, a reduction of roughly 20%. Founder Securities previously noted that continued expansion of capital expenditure by cloud providers has been an important support for this round of gains in AI hardware stocks, but rising investment scale and rising share prices do not always move in sync. Whether the market expectation that the growth rate of cloud capital expenditure has peaked in this cycle proves valid may have significant guiding value for the sustainability of future gains in AI hardware stocks.
Hua Hong Semiconductor (01347) and SMIC (00981) suffered net selloffs of HK$423 million and HK$910 million respectively. CLSA previously said that wafer foundry capacity utilization remains high, supported by AI-related chip demand, the return of overseas orders and domestic manufacturing, with average selling prices continuing to rise quarter on quarter, but new capacity investment and increasing depreciation on advanced processes will constrain margin improvement. Goldman Sachs said that to reflect the integration of Hua Hong's subsidiary Huali Microelectronics, it cut net profit forecasts for fiscal years 2026 to 2027 by 5% and 2%, while raising its 2028 forecast by 3%.
In addition, Realord Group Holdings (01196) attracted net buying of HK$251 million, while CNOOC (00883) suffered a net selloff of HK$227 million.
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