Hong Kong’s major indices ended the week on a strong note, signaling renewed investor confidence amid growing momentum in financial and digital asset sectors. The Hang Seng Index, Hang Seng Tech Index, and Hang Seng China Enterprises Index all posted solid gains, driven by strategic shifts in financial firms and favorable policy tailwinds for digital innovation.
Weekly Market Performance: Indices on the Rise
The Hong Kong stock market closed higher across the board this week, reflecting broad-based optimism.
- Hang Seng Index: Up 3.20%, closing at 24,284.15 points
- Hang Seng Tech Index: Gained 4.06%, ending at 5,341.43 points
- HSCEI (China Enterprises Index): Rose 2.76%, settling at 8,762.47 points
This upward trend highlights strengthening market sentiment, particularly in sectors aligned with technological transformation and financial innovation.
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Financial Stocks Take Center Stage
Financial equities emerged as top performers this week, with several stocks experiencing dramatic rallies fueled by strategic developments and regulatory progress.
China Financial Leasing Soars on AI and Web3.0 Transformation Plans
China Financial Leasing (02312.HK) surged an astonishing 1407.94% week-on-week following news of a major ownership change. Longling Capital, linked to Meitu founder Cai Wensheng, acquired a 34.96% stake at HK$0.38 per share—a 13.43% premium—sparking speculation about a strategic pivot toward next-generation technologies.
Investors anticipate the company will evolve into an asset management platform focused on AI, Web3.0, and digital assets, aligning with Hong Kong’s broader ambitions to become a regional hub for fintech innovation.
Guotai Junan International Jumps After Virtual Asset License Upgrade
Guotai Junan International (01788.HK) skyrocketed nearly 200% in a single day after receiving approval from the Securities and Futures Commission (SFC) to upgrade its virtual asset trading license. This makes it the first Chinese-funded securities firm authorized to offer crypto and stablecoin trading services in Hong Kong.
This regulatory milestone underscores Hong Kong’s commitment to building a compliant digital asset ecosystem. Other financial players like Shenyin & Wanguo Hong Kong (00218.HK), First Shanghai (00227.HK), and Victory Securities (08540.HK) also posted strong gains of over 24%, reflecting market enthusiasm for firms positioned at the intersection of traditional finance and blockchain technology.
Digital Economy Momentum Builds
Beyond individual stock moves, the broader digital economy narrative gained traction this week, supported by government initiatives and institutional adoption.
Hong Kong’s Digital Asset Policy 2.0 Unveiled
On June 26, the Hong Kong Special Administrative Region government released its "Hong Kong Digital Asset Development Policy Declaration 2.0", introducing the LEAP framework—a strategic roadmap aimed at promoting tokenized financial products and real-world asset (RWA) applications.
The policy reaffirms Hong Kong’s ambition to become a global digital asset innovation center, encouraging institutional participation while maintaining strict compliance standards. This has created fertile ground for companies like Bluehole Interactive (08267.HK), which gained nearly 40%, to capitalize on growing interest in blockchain gaming and decentralized platforms.
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Consumer and Tourism Stocks Ride Seasonal Tailwinds
Hong Kong China Travel Service Benefits from Summer Demand
Hong Kong China Travel Service (00308.HK) rose 67.29% this week, driven by robust summer travel demand. With domestic tourism up 26.4% year-on-year in Q1 and tourism revenue rising 19%, the company is expanding into emerging sectors such as ice-snow economy and low-altitude economy—including drone tourism and aerial sightseeing.
Additionally, its inclusion in the Hang Seng Composite Index and potential addition to the Stock Connect program have attracted significant institutional inflows. If it maintains a market cap above HK$730 million for three consecutive trading days, it could qualify for northbound access, opening the door to mainland Chinese capital.
Saturday Gold Shines in IPO Frenzy
Jewelry brand Saturday Gold (06168.HK) made headlines with its listing, surging over 50% in two days. The IPO drew HK$1 trillion in retail subscriptions—an oversubscription of 594 times, one of the most competitive in recent history.
Market analysts believe the stock is on track for Stock Connect eligibility by the end of June, further boosting investor appetite ahead of potential mainland inflows.
Sector Spotlight: Winners and Losers
While financials and digital assets led gains, other sectors faced headwinds.
Auto Stocks Retreat Amid Pricing Pressures
Top EV makers saw declines:
- XPeng-W (09868.HK): Down 3.17%
- NIO-SW (09866.HK): Down 1.84%
- BYD Company (01211.HK): Down 1.19%
The pressure stems from Xiaomi’s aggressive pricing on its new SU7 sedan, which could sell up to 60,000–80,000 units monthly according to Citi estimates. Analysts suggest XPeng’s G7 model may need to drop to RMB 210,000 to stay competitive, potentially triggering a wider price war that could affect Tesla’s pricing strategy as well.
Pharma Sector Faces Profit-Taking
Biotech stocks corrected after earlier rallies:
- China Antibody-B (03681.HK): Down 10.33%
- Jacobio-B (01167.HK): Down 9.42%
- Elpiscience-B (01541.HK): Down 6.27%
The pullback reflects profit-taking following strong runs and tighter liquidity conditions in the broader market.
Banks Dip Slightly Despite Positive Outlook
Banking stocks showed modest declines:
- Luzhou Bank (01983.HK): Down 3.49%
- Chongqing Bank (01963.HK): Down 2.91%
- China Merchants Bank (03968.HK): Down 2.39%
However, analysts remain optimistic. China Galaxy Securities highlighted that H2 could see a “triple convergence” of credit expansion, interest rate cuts easing net interest margin pressure, and improved corporate asset quality due to debt relief and real estate policy support.
Commodity Gains: Copper Shines
Copper-related stocks bucked the downtrend:
- Jiangxi Copper (00358.HK): Up 7.71%
- MMG Limited (01208.HK): Up 4.37%
- China Nonferrous Mining (01258.HK): Up 3.39%
The rally follows escalating U.S. trade actions under Section 232 targeting copper imports, disrupting global supply flows and creating price divergence between COMEX and LME markets. Goldman Sachs raised its 2025 copper price forecast, projecting LME prices to reach $9,890/ton**, with a peak of **$10,050 in August before moderating to $9,700 by year-end.
Notable Stock Movers
Xiaomi Jumps on Strong SUV Demand
Xiaomi Group-W (01810.HK) rose 3.6% to HK$58.95 after Deutsche Bank analyst Bin Wang reported that the company received 289,000 orders within one hour of launching its YU7 SUV—far exceeding market expectations of 100,000. The bank forecasts 100,000 deliveries in H2, with mass deliveries starting in July.
Tianqi Lithium Gains on Demand Recovery Hopes
Tianqi Lithium (09696.HK) climbed 6.78% to HK$29.15 as lithium prices showed signs of stabilization. The domestic lithium carbonate futures contract (2509) rebounded to RMB 60,700/ton from a low of RMB 58,400. Guotai Haitong expects seasonal demand recovery during the “Golden September and Silver October” period in Q3 2025, coupled with ongoing supply cuts, to support further price stabilization and inventory drawdowns.
Frequently Asked Questions (FAQ)
Q: What drove the surge in Hong Kong financial stocks?
A: Strategic shifts toward digital assets—such as China Financial Leasing’s pivot to AI and Web3.0—and regulatory milestones like Guotai Junan International’s upgraded virtual asset license were key catalysts.
Q: Why did digital asset-related stocks perform so strongly?
A: The release of Hong Kong’s Digital Asset Policy 2.0 and the LEAP framework boosted investor confidence in blockchain-based financial innovation and real-world asset tokenization.
Q: Is Saturday Gold likely to be included in Stock Connect?
A: Yes—if it maintains a market cap above HK$730 million for three consecutive trading days by the end of June, it will meet the threshold for inclusion.
Q: What’s affecting auto stocks negatively?
A: Xiaomi’s competitively priced SU7 is expected to disrupt the EV market, prompting fears of a price war that could impact margins for XPeng, NIO, and even Tesla.
Q: Are copper prices expected to keep rising?
A: Goldman Sachs forecasts LME copper prices to peak at $10,050/ton in August 2025 before settling around $9,700 by year-end, supported by trade disruptions and tight supply.
Q: What’s the outlook for lithium prices?
A: Analysts expect Q3 2025 demand recovery and continued production cuts to reduce inventory levels and provide stronger support for lithium prices in the second half of the year.
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