Hang Seng climbs to eight-week high as tech and autos rally despite southbound outflows

Hong Kong's Hang Seng Index rose to an eight-week high and reclaimed 25,000, closing up 491 points, or 1.96%, at 25,807.92 after earlier reporting had put the benchmark up 1.5%, or 385 points, to 25,692. The Hang Seng Tech Index gained 2.84% to 4,864.73 and the Hang Seng China Enterprises Index rose 2.22%, while full-day market turnover reached HK$312.23 billion. The advance was led by auto and technology shares. Auto names climbed after China's Ministry of Industry and Information Technology said it is accelerating work on the 15th Five-Year Plan for intelligent connected vehicles, with Li Auto up 9.9%, Leapmotor up 9.5%, Chery Automobile up 6.73% and BYD up nearly 5%. Xiaomi rose 8.95% to HK$31.88 on heavy trading ahead of its July 30 "Xiaomi Pengcheng Series Technology Launch Event," Tencent gained 4.29%, and Alibaba added 1.7% after releasing its Qwen 3.8 model. Even as stocks rallied, mainland Chinese investors continued to trim Hong Kong holdings through Stock Connect. Southbound funds recorded a net outflow of HK$5.59 billion on the 29th, the fifth straight trading day of net selling, with turnover through southbound channels rising to HK$125.17 billion, or about 40% of overall Hang Seng turnover. SMIC saw HK$2.01 billion of net selling and Xiaomi HK$1.95 billion, while Alibaba and Tencent still drew net buying of HK$1.33 billion and HK$832 million respectively. Short-selling in Hong Kong stocks rose to HK$57.92 billion, or 20% of turnover in short-sellable shares. Weakness was concentrated in memory-chip and PCB-related names after SK Hynix reported record second-quarter operating profit that rose 5.57 times year on year but missed market expectations. CSOP 2x Long SK Hynix fell 13.99%, ChipMOS Technologies dropped 15.8%, and GigaDevice Semiconductor fell more than 10% in one account, though another report said GigaDevice was among the few technology names with sustained southbound inflows.