On July 29, 2026, Hong Kong stocks experienced a dramatic rebound after a sluggish morning session. The Hang Seng Index staged a V-shaped reversal in the afternoon, closing at 23,650 points, up 0.68%, successfully recovering the 23,600-point mark. The H-Share Index rose 0.85% in tandem, while the Tech Index gained 1.23%. Market turnover increased to HK$128 billion, with southbound net buying reaching HK$2.57 billion, indicating stronger mainland capital inflows.
Market Review: Morning Pressure, Afternoon Reversal
The HSI opened lower at 23,480 points, dragged by overnight adjustments in US tech stocks and geopolitical news, falling to 23,320 points at one point in early trading, a drop of over 0.8%. However, near midday, the new energy sector led a rally, and market sentiment began to recover. After the afternoon open, pharmaceutical stocks took up the baton, coupled with strength from heavyweight tech stocks like Tencent and Meituan, the HSI quickly turned positive and continued to climb, eventually closing near the session high. By sector, the Hang Seng Tech Index rose 1.23%, the Hang Seng Healthcare Index gained 2.15%, the Hang Seng Energy Index advanced 1.87%, while the Financial and Property Index edged down 0.12%.
Sector Highlights: New Energy and Pharma Dual Engines
New Energy Sector: Policy Boost Sustains Momentum
The new energy sector was the vanguard of the day's rebound. On the news front, the National Energy Administration recently released the "Several Measures to Promote High-Quality Development of New Energy," proposing increased subsidies for offshore wind power and promoting large-scale development of energy storage projects. Lifted by this, Dongfeng Motor Group (00489.HK) rose 4.5%, Longyuan Power (00916.HK) gained 3.8%, and Goldwind Technology (02208.HK) added 4.2%. In addition, solar stock GCL Technology (03800.HK) surged 5.6%, recording its largest single-day gain in nearly a month.
Pharmaceutical Stocks: Innovative Drug Companies Lead
The pharmaceutical sector rallied broadly in the afternoon, especially innovative drug companies. BeiGene (06160.HK) posted positive clinical data for its PD-1 inhibitor in a lung cancer indication, sending its shares up 7.2%. Innovent Biologics (01801.HK) followed closely with a 6.5% gain. In the biotech space, Akeso (09926.HK) and Junshi Biosciences (01877.HK) rose 4.8% and 5.3%, respectively. Market analysts believe that after a significant pullback, valuations in the pharmaceutical sector have entered a reasonable range, and coupled with recent new drug approvals, capital inflows are becoming evident.
Tech Stocks: Tencent and Meituan Recover
Heavyweight tech stocks rebounded in the afternoon. Tencent Holdings (00700.HK) closed up 1.8% at HK$385; Meituan (03690.HK) rose 2.3% to HK$218; Alibaba (09988.HK) edged up 0.5%. However, some semiconductor stocks remained under pressure, with SMIC (00981.HK) down 0.3%, indicating divergence within the sector.
Fund Flows: Southbound Funds Continue to Pour In
In terms of fund flows, northbound funds (Shanghai-HK and Shenzhen-HK Stock Connect) recorded net buying of RMB 2.8 billion in A-shares today, while southbound funds (Hong Kong Stock Connect) saw net buying of HK$2.57 billion, marking the sixth consecutive day of net inflows. Southbound funds focused on adding to Tencent Holdings (net buy HK$520 million), China Mobile (00941.HK) (net buy HK$380 million), and WuXi AppTec (02359.HK) (net buy HK$260 million). By industry, pharmaceuticals, new energy, and telecom operators were the main allocation targets for southbound funds. Industry insiders noted that mainland capital has strong interest in high-dividend and high-growth sectors in Hong Kong, and southbound funds are expected to continue providing support to the market in the near term.
Market Outlook: Short-Term Volatility, Structural Opportunities Ahead
Looking ahead, a CICC research report pointed out that Hong Kong stock valuations remain at historical lows, with the HSI's forward P/E ratio around 10 times, a trough among major global markets. Although external uncertainties persist, the domestic economic recovery trend is clear, and corporate earnings are expected to gradually improve. In terms of sector allocation, analysts recommend focusing on high-growth areas such as new energy, biomedicine, and consumer electronics. Additionally, the Hang Seng Index Company will conduct its quarterly review next week, and market expectations are that some new economy stocks may be included, bringing incremental capital.
However, some analysts also flagged risks. Ye Shangzhi, chief strategist at First Shanghai Securities, said that although Hong Kong stock turnover has increased recently, it has yet to break through HK$150 billion, and the willingness to chase highs is limited. Moreover, the Federal Reserve's July interest rate meeting is scheduled for next week, and there is divergence in market expectations for rate hikes, which could temporarily disrupt global capital flows. Investors should stay nimble and manage positions.
Today's Hong Kong Stock Market Snapshot
- Hang Seng Index: 23,650 pts, up 0.68%
- H-Share Index: 8,150 pts, up 0.85%
- Hang Seng Tech Index: 5,010 pts, up 1.23%
- Main Board Turnover: HK$128 billion (up 12% from yesterday)
- Southbound Net Buying: HK$2.57 billion
- Advancers/Decliners: 950/680
- Leading Sectors: New Energy, Pharmaceuticals, Tech
- Lagging Sectors: Financial & Property, Utilities
Overall, Hong Kong stocks achieved a V-shaped rebound driven by positive news, and market sentiment improved. However, sustained upward momentum still depends on whether trading volume can further expand and heavyweight stocks can stabilize. Investors can selectively buy quality growth stocks on dips while remaining cautious of external risk events.
