Southbound Funds Hit New High in September: HK Stocks' Low Valuation Attraction Prominent, Dual-Focus Strategy on AI and High Dividends

On September 29, 2026, the Hong Kong stock market continued to show a volatile upward trend, with southbound capital continuously increasing its position in the Hong Kong market, with weekly net inflow reaching a new high for the year. As mainland investors' enthusiasm for allocating to low-valued Hong Kong assets continues to grow, Stock Connect eligible stocks have become the focus of capital pursuit. This article will conduct an in-depth analysis of the latest trends of southbound capital, key investment directions, and their impact on the Hong Kong stock market, providing valuable references for investors. Southbound capital reaches new high in September, with consecutive daily net inflows According to the latest data, since September 2026, southbound capital has continuously flowed into the Hong Kong stock market through the Stock Connect channel, with weekly net inflow exceeding 15 billion Hong Kong dollars, setting a new high for the year. This represents an increase of approximately 25% compared to the same period last month, showing the growing confidence of mainland investors in the Hong Kong stock market. Notably, southbound capital has maintained a net inflow for 12 consecutive trading days, with the cumulative net inflow exceeding 80 billion Hong Kong dollars. Analysts point out that the continuous inflow of southbound capital is mainly driven by three factors: first, the overall valuation of the Hong Kong stock market is at a historical low, showing a significant discount compared to A-shares; second, the Hong Kong market has a high degree of internationalization, abundant liquidity, and provides investors with a more convenient trading environment; third, as the opening-up of the mainland capital market continues to deepen, investors' demand for allocating to high-quality overseas assets is growing. Key investment focus: AI and high dividends as dual main themes Looking at the specific sectors of capital flow