Hang Seng Rebounds to Close Higher as AI Stocks Retreat on Rate-Hike Concerns
SingTao · 6 SOURCESabout 11 hours ago4 MIN
Summary
The Hang Seng Index opened lower on Monday morning as markets braced for a pivotal week of central bank decisions, extending its losing streak to six consecutive sessions before staging a remarkable recovery . The sentiment was further complicated when three major US AI companies—Anthropic, OpenAI, and SpaceX AI—issued a rare joint call urging the industry to slow the pace of AI development, triggering a broad selloff in AI-related concept stocks . By the close, however, the index had bounced back to close at 24,917, up 111 points or 0.45%, with technology stocks showing mixed performance . Meanwhile, Zhipu AI (2513) announced a massive HK$39.2 billion fundraising exercise through a share placement and convertible bonds, yet its shares still tumbled 9% amid the broader AI sector weakness . Techtronic Industries (669) emerged as a bright spot, rising 0.2% after revealing plans to split its board lots from 500 shares to 100 shares, making the stock more accessible to retail investors .
Key Points
- The Hang Seng Index opened at 24,701 points, down 104 points (0.42%), before recovering to close at 24,917, gaining 111 points or 0.45%, ending five consecutive days of losses
- Three US AI giants—Anthropic CEO Dario Amodei, OpenAI CEO Sam Altman, and SpaceX AI founder Elon Musk—jointly called for slowing AI development, with OpenAI stating it will not go public this year
- AI concept stocks suffered significant losses: Minimax (100) fell 5.6%, Cambridge Technology (6166) dropped 4.6%, Biren Technology (6082) retreated 3.5%, and Daysys (9903) declined 2.5%
- Zhipu AI (2513) plans to place up to 21.97 million H shares at HK$714 each, a 9.96% discount, raising HK$15.68 billion; simultaneously issuing HK$20.14 billion RMB zero-coupon convertible bonds at HK$892.5 exercise price, total fundraising approximately HK$39.2 billion
- Techtronic Industries (669) announced changing its board lot size from 500 shares to 100 shares, effective October 5, with shares opening at HK$127.3, up 0.2%
- Major tech stocks ended mixed: Xiaomi rose 3%, Tencent gained 0.5%, Alibaba fell 1.4%, JD.com dropped 0.1%, Meituan slipped 0.1%, and Lenovo advanced 2.6%
- The Federal Reserve is widely expected to raise interest rates by 25 basis points to 3.75%-4% on Thursday (Hong Kong time), with the probability near 90% following last Friday's US CPI data
- The Bank of Japan is forecast to raise rates by 0.25 percentage points to 1.25% on Friday, which would mark the highest level since 1995
- Oil prices surged on geopolitical concerns: NYMEX crude rose 4.2% to US$104.24 per barrel while Brent crude climbed 4.4% to US$109.27 per barrel
- Semiconductor stocks under pressure: SMIC (981) fell 2.93% to HK$61.3, and Hua Hong Semiconductor (1347) dropped 4.66% to HK$106.5
- Biotech and pharmaceutical stocks outperformed: Hansoh Pharmaceutical (3692) surged 5.1%, WuXi AppTec (2359) rose 4.8%, and WuXi Biologics (2269) gained 4%
Why It Matters
With the Federal Reserve expected to raise interest rates for the first time in three years, Hong Kong markets face heightened sensitivity to hawkish signals in the post-meeting statement and dot plot projections . Analysts suggest the Hang Seng's immediate support lies at 24,300 points, with a potential test of the 22,600 level if US-China tensions escalate alongside rising Treasury yields . Given the elevated interest rate environment, investors are advised to consider high-dividend stocks yielding above 5.5% as defensive positions, or shift toward more stable sectors like financial and utility stocks while avoiding rate-sensitive technology shares .
With the Federal Reserve expected to raise interest rates for the first time in three years, Hong Kong markets face heightened sensitivity to hawkish signals in the post-meeting statement and dot plot projections . Analysts suggest the Hang Seng's immediate support lies at 24,300 points, with a potential test of the 22,600 level if US-China tensions escalate alongside rising Treasury yields . Given the elevated interest rate environment, investors are advised to consider high-dividend stocks yielding above 5.5% as defensive positions, or shift toward more stable sectors like financial and utility stocks while avoiding rate-sensitive technology shares .