[ET Net News Agency, 16 June 2026] Hit by Mainland China consumption data, domestic demand and e-commerce stocks slumped collectively. Coupled with the gradual decline in Hong Kong stock turnover ahead of the Federal Reserve's interest rate meeting, the HSI reported 24,533 at midday, down 309 points or 1.2%. The Hang Seng China Enterprises Index stood at 8,265, down 110 points or 1.3%. The Hang Seng Tech Index reported 4,688, down 76 points or 1.6%. Main board turnover exceeded HKD 133.7 billion at midday, though southbound capital recorded a net inflow of HKD 4.4 billion for the half-day, with expectations of increased support to the market in the afternoon.
"Mak Ka Ka: Cross-border investment restrictions affect market sentiment"
The US and Iran have reportedly signed an electronic version of a memorandum of understanding, bringing hope for the reopening of the Strait of Hormuz. While overseas stock markets performed well, Hong Kong stocks remained under selling pressure, dropping over 300 points at midday, with tech and consumption sectors hard hit. Mak Ka Ka, Head of Financial Products Trading and Research Department of SinoPac Securities (Asia), told ET Net News Agency that the current weakness of the HSI is mainly affected by Mainland China's restrictions on cross-border investment. Due to policy restrictions rendering cross-border stock trading capital within two years "sell-only, no-buy", the market worries that even if the HSI stages a rebound, a large number of investors will take advantage of the pullback to unload goods. This led to heavy selling pressure above the market today and inactive buying below.
Based on the current market sentiment, even if the overseas situation improves, Mak believes that the market's recent view will lean towards caution, and there will still be selling pressure in the short term. She expects that in the short run, the HSI will continue to face downward pressure and test the 24,200 support level, with upper resistance around 25,000 points.
Cheung Chi Wai, a joint managing director at Prudential Brokerage Ltd, also mentioned that Mainland China's fixed-asset investment data for May and retail data for May released today performed worse than expected. The market is worried that the pace of China's economic recovery is slowing down. With both investment and consumption being weak, market confidence has been directly hit, dragging down the overall performance of the market.
"World Cup effect fades and 618 also cold, consumption stocks stand aside"
Mainland China's economic data for May was released today, among which consumption data performed worse than expected. Total retail sales of consumer goods fell by 0.6% year-on-year, turning negative for the first time since the pandemic in Dec 2022. Today, consumption, new consumption, and e-commerce sectors suffered setbacks. Li Ning (02331) fell nearly 5% at midday, Lao Pu Gold (06181) dropped over 6%, while e-commerce stocks such as Meituan (03690) and Alibaba (09988) fell nearly 4% and 2% respectively.
Mak Ka Ka stated that consumption stocks are currently not the investment theme of this year. With capital clearly diverting to AI-related industries, the performance of the consumption sector is expected to continue to adjust downwards or flatten out. She mentioned that after the rally over the past two years, it is difficult for new consumption stocks to support their business solely by relying on concepts such as "self-pleasing consumption, emotional value, and high-valuation IP". The market has begun to focus on the risks of overheated valuations and earnings delivery, such as Pop Mart's IP monetisation capability. It is expected that the market will more strictly distinguish between growth and speculative shares among new consumption stocks in the future. In a chilly market consumption atmosphere, it is difficult for the stock prices of new consumption stocks to sustain their valuations.
Although the World Cup has recently kicked off, due to the poor consumption trend in the market at present, shares previously classified as "World Cup concept stocks" such as Li Ning and Budweiser APAC are expected to receive limited boost. Currently, they need to rely on Mainland China introducing policies to expand consumption (such as consumption vouchers) before the sector can be driven forward. Regarding e-commerce stocks, Mak stated that the market response to the "618 Shopping Festival" was lukewarm, and coupled with the gradually increasing impact of platform regulatory policies, valuations are expected to be further adjusted downwards.
For the consumption and e-commerce sectors, Mak suggests that investors should currently adopt a "stand aside" attitude, focusing mainly on wait-and-see, and should not rush to deploy at low levels. For investors who already hold shares, they can reduce their holdings and switch horses when stock prices rebound. Taking Lao Pu Gold as an example, Mak believes that investors can reduce holdings and switch horses when the stock price returns to the HKD 540 position.
"Mak Ka Ka: Cross-border investment restrictions affect market sentiment"
The US and Iran have reportedly signed an electronic version of a memorandum of understanding, bringing hope for the reopening of the Strait of Hormuz. While overseas stock markets performed well, Hong Kong stocks remained under selling pressure, dropping over 300 points at midday, with tech and consumption sectors hard hit. Mak Ka Ka, Head of Financial Products Trading and Research Department of SinoPac Securities (Asia), told ET Net News Agency that the current weakness of the HSI is mainly affected by Mainland China's restrictions on cross-border investment. Due to policy restrictions rendering cross-border stock trading capital within two years "sell-only, no-buy", the market worries that even if the HSI stages a rebound, a large number of investors will take advantage of the pullback to unload goods. This led to heavy selling pressure above the market today and inactive buying below.
Based on the current market sentiment, even if the overseas situation improves, Mak believes that the market's recent view will lean towards caution, and there will still be selling pressure in the short term. She expects that in the short run, the HSI will continue to face downward pressure and test the 24,200 support level, with upper resistance around 25,000 points.
Cheung Chi Wai, a joint managing director at Prudential Brokerage Ltd, also mentioned that Mainland China's fixed-asset investment data for May and retail data for May released today performed worse than expected. The market is worried that the pace of China's economic recovery is slowing down. With both investment and consumption being weak, market confidence has been directly hit, dragging down the overall performance of the market.
"World Cup effect fades and 618 also cold, consumption stocks stand aside"
Mainland China's economic data for May was released today, among which consumption data performed worse than expected. Total retail sales of consumer goods fell by 0.6% year-on-year, turning negative for the first time since the pandemic in Dec 2022. Today, consumption, new consumption, and e-commerce sectors suffered setbacks. Li Ning (02331) fell nearly 5% at midday, Lao Pu Gold (06181) dropped over 6%, while e-commerce stocks such as Meituan (03690) and Alibaba (09988) fell nearly 4% and 2% respectively.
Mak Ka Ka stated that consumption stocks are currently not the investment theme of this year. With capital clearly diverting to AI-related industries, the performance of the consumption sector is expected to continue to adjust downwards or flatten out. She mentioned that after the rally over the past two years, it is difficult for new consumption stocks to support their business solely by relying on concepts such as "self-pleasing consumption, emotional value, and high-valuation IP". The market has begun to focus on the risks of overheated valuations and earnings delivery, such as Pop Mart's IP monetisation capability. It is expected that the market will more strictly distinguish between growth and speculative shares among new consumption stocks in the future. In a chilly market consumption atmosphere, it is difficult for the stock prices of new consumption stocks to sustain their valuations.
Although the World Cup has recently kicked off, due to the poor consumption trend in the market at present, shares previously classified as "World Cup concept stocks" such as Li Ning and Budweiser APAC are expected to receive limited boost. Currently, they need to rely on Mainland China introducing policies to expand consumption (such as consumption vouchers) before the sector can be driven forward. Regarding e-commerce stocks, Mak stated that the market response to the "618 Shopping Festival" was lukewarm, and coupled with the gradually increasing impact of platform regulatory policies, valuations are expected to be further adjusted downwards.
For the consumption and e-commerce sectors, Mak suggests that investors should currently adopt a "stand aside" attitude, focusing mainly on wait-and-see, and should not rush to deploy at low levels. For investors who already hold shares, they can reduce their holdings and switch horses when stock prices rebound. Taking Lao Pu Gold as an example, Mak believes that investors can reduce holdings and switch horses when the stock price returns to the HKD 540 position.
