China & HK Equities Mixed As Tech Rallies, Regulatory Developments

Hong Kong and China equities had a mixed performance today, influenced by positive momentum from Wall Street and regulatory developments in China, while concerns over delistings and economic indicators weighed on sentiment. Overall, tech and semiconductor stocks provided a boost, but regulatory pressures and mixed economic data continued to cast a shadow over the broader market sentiment.

• Hong Kong equities, with the HSI up 1.95%, driven by positive sentiment from Wall Street and hopes for US interest rate cuts. The HSTech Index is 1.96%, the Mainland Property Index increased by 2.03%, and the HS Property Index was up by 2.13%.
• China Onshore equities are mostly lower today with small-cap indices the CSI 1000 down by 0.94% and the CSI 2000 down by 0.30%, while the broader CSI 300 Index fell by 0.42%, and the CSI 300 Real Estate Index decreased by 1.00%.
• China has tightened oversight of listed companies, setting higher standards and stricter delisting rules to enhance market quality and protect investor rights. A nine-point guideline aims to improve corporate governance and transparency. Additionally, China launched a $47.5 billion semiconductor investment fund to bolster its domestic chip industry and counteract US-led export controls.
• US lawmakers are proposing a bipartisan bill to prevent companies that receive federal chipmaking funds from using Chinese-made equipment at government-backed factories. This bill aims to limit Beijing’s influence on domestic chip production and would apply only to US facilities funded by the 2022 Chips and Science Act, not to overseas operations.
• Looking ahead, focus will turn to China's 1yr & 5yr LPR and Hong Kong Unemployment Rate on Thursday