Hong Kong stocks retreat as regional tech volatility offsets short covering
Zhipu AI bucked the downward trend to surge over 10 per cent as volatility surrounding its recent IPO share unlocking began to ease
Hong Kong stocks retreated on Thursday morning, surrendering recent gains as ongoing volatility across Asian markets and a brutal tech sell-off in neighbouring bourses weighed on local sentiment.
At the lunchtime break, the benchmark Hang Seng Index was down 0.78 per cent to 24,011, erasing its initial upwards momentum. The Hang Seng Tech Index edged down 0.06 per cent, as the broader regional drag overshadowed optimism surrounding recent initial public offering lock-up expirations.
Among high-profile tech movers, Knowledge Atlas Technology, also known as Zhipu AI, bucked the downward trend to surge over 10 per cent as trading volatility surrounding its recent IPO share unlocking began to ease. In contrast, rival artificial intelligence model developer MiniMax tumbled nearly 14 per cent while navigating its first major lock-up expiry on Thursday.
Meanwhile, certain semiconductor players bucked the broader market decline, with Smart-Core Holdings jumping more than 23 per cent.
The intraday decline in Hong Kong came as regional bourses stabilised after severe weekly corrections. South Korea’s Kospi index edged up 0.3 per cent on Thursday, a day after the benchmark officially entered a technical bear market by plunging more than 20 per cent from its June peak due to heavy selling in the tech sector. Japan’s Nikkei 225 also staged a modest rebound, rising around 2 per cent after days of heavy losses.
Despite the midday slide in Hong Kong, market observers noted that foreign institutions were aggressively unwinding their “funding shorts”, as regional corrections prompted global investors to cover Chinese equity shorts previously used to finance other Asian trades.