The Hang Seng Index opened down 0.69%, while the Hang Seng Tech Index fell 0.88%.
In market movements, large AI model concept stocks showed strength, with MINIMAX-WP (HKEX: 00100) and Zhipu AI rising 3%.
The non-ferrous metals sector declined, with Zijin Mining Group Co., Ltd. and Lingbao Gold Group Co., Ltd. falling over 2%.
Market Outlook and Analysis
Regarding the future direction of the Hong Kong market, Soochow Securities believes the number of positive catalysts has increased significantly compared to earlier periods.
Aside from the US-Iran agreement, this week's Federal Reserve interest rate meeting is a crucial catalyst.
As long as the new Federal Reserve Chair, Kevin Warsh, delivers a relatively neutral stance (avoiding strong hawkish signals), it could effectively provide a floor for global risk assets, benefiting a rebound in Hong Kong stocks and the return of foreign capital.
China Securities (CSC) Research notes in a report that the main upward trend for Hong Kong stocks is currently being established.
The market is transitioning from the earlier phase of valuation and sentiment repair to a new stage jointly driven by earnings verification and improving risk appetite.
From a broader cycle perspective, Hong Kong stocks have moved past the low-valuation repair phase seen since last year and have formally entered the middle-to-later stage of a bull market.
This stage will likely not feature a broad-based index rally but rather a structural advance driven by earnings, sectoral momentum, and industrial delivery.
Liquidity improvements and valuation repairs have already been largely realized; the core variable determining future excess returns will shift to earnings verification.
Internet giants have already shown structural improvement in their first-quarter reports, and market expectations for an earnings recovery in Hong Kong stocks are being rebuilt.
China Galaxy Securities states that the Federal Reserve will announce its interest rate decision in the early hours of June 18, Beijing time.
This will be the first FOMC meeting under the chairmanship of Kevin Warsh.
Warsh's debut is highly likely to involve "maintaining the status quo + removing dovish bias + delivering ambiguous remarks," meaning he will acknowledge strong economic data, elevated inflation, and no rush to cut rates, while also not committing to hikes and emphasizing data dependency.
Under a scenario that meets expectations, Hong Kong stocks are expected to focus on high-dividend defensive plays in the short term, while medium-term opportunities lie in the "expectation gap" repair within the technology sector.
It is advisable to maintain flexible positioning before the decision is finalized.
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