Hong Kong Stock Connect Expands Again: 15 New Economy Stocks Included
On July 28, 2026, HKEX and the Shanghai and Shenzhen stock exchanges jointly announced the new round of Hong Kong Stock Connect target adjustment list, effective immediately. This expansion includes 15 stocks, all high-growth new economy enterprises, covering frontier fields such as artificial intelligence, new energy vehicles, biotech, and cloud computing. Three traditional cyclical stocks with shrinking market cap were removed, bringing the total number of Stock Connect targets to over 600, covering more than 90% of Hong Kong stock market value.
Specifically, the newly included star stocks include AI chip design company Cambricon's Hong Kong-listed subsidiary SmartCore International (09999.HK), new energy vehicle maker NIO's subsidiary WeNeng Battery (02345.HK), and innovative drug company BeiGene's subsidiary BeiGene Biotech (02956.HK). HKEX stated that the adjustment aims to align with the tech wave and provide Mainland investors with more diversified growth asset allocation options.
Southbound Funds Accelerate Inflow: Net Buy Over HKD 500 Billion in H1
Alongside the Stock Connect expansion, southbound funds have surged this year. According to Wind data, net buying of Hong Kong stocks by southbound funds in H1 2026 reached HKD 529 billion, up 45% YoY, exceeding 70% of last year's total. Monthly net buying in March and June both exceeded HKD 100 billion, hitting record highs. Fund flows show two major features: continued accumulation of high-dividend sectors like China Mobile (00941.HK) and CCB (00939.HK), and accelerated deployment in new economy leaders, especially preemptive buying ahead of Stock Connect inclusion expectations.
Seasoned Hong Kong stock analyst Li Ming noted: 'The structural shift of southbound funds is obvious, from past preference for financial and real estate to a dual drive of tech growth plus dividends. Most of the newly included stocks under this expansion are popular representatives of 'new quality productive forces', expected to attract tens of billions in incremental funds.' He emphasized that AI and new energy sectors have good liquidity and valuations at historical lows, suitable for medium-term allocation.
Gold Mining Roadmap: Focus on Four Major Tracks
Based on the expansion list and southbound fund trends, investors can deploy H2 opportunities in Stock Connect through the following four tracks:
1. AI and Computing Power
Represented by SmartCore International, backed by Cambricon, focusing on AI training and inference chips, with 2025 revenue exceeding HKD 8 billion, up 120% YoY. AI chip targets are scarce in Hong Kong, and valuation premiums are likely to persist. It is recommended to monitor order fulfillment and gross margin improvement, buying on dips.
2. New Energy Vehicles and Batteries
WeNeng Battery, as NIO's battery swap business spin-off, manages swap networks and battery assets, achieving over 100 million swaps in 2025 with user penetration rising to 35%. As swap standard unification policies advance, the company is expected to reach a profit inflection point.
3. Innovative Drugs and Biotech
BeiGene Biotech specializes in bispecific antibodies and ADC drugs, with two pipeline candidates entering Phase III clinical trials and licensing deals with multinational pharma companies. After two years of adjustment, the Hong Kong biotech sector has returned to reasonable valuations, and stocks with earnings breakout potential are worth tracking.
4. High-Dividend Dividend Sector
Despite the spotlight on new economy stocks, southbound funds have not abandoned dividend assets. CNOOC (00883.HK) and China Shenhua (01088.HK) still have dividend yields above 5% in H1 and offer defensive attributes. A portfolio approach is recommended, using dividends as ballast alongside growth stocks for flexibility.
Risk Warning and Strategy Summary
While the Stock Connect expansion brings incremental funds, investors should note three major risks: first, repeated Fed rate hike expectations may pressure Hong Kong liquidity; second, new economy stocks have volatile valuations, requiring caution against earnings disappointments; third, geopolitical disturbances may affect foreign investor sentiment. In terms of operations, a 'core + satellite' strategy is recommended: core positions in high-dividend state-owned enterprise ETFs (e.g., CSOP Hang Seng SOE ETF), and satellite positions in phased fixed investment of new economy leaders.
Overall, this Stock Connect expansion injects new variables into the H2 Hong Kong stock market, with gold mining opportunities focusing on quality targets aligned with Mainland China's economic transformation. Investors can seize the adjustment window and actively deploy based on their risk appetite.
