In recent months, the Hong Kong stock market has emerged as one of the brightest spots on the global stage, boasting remarkable performance since FebruaryDespite a slight adjustment on February 11, the Hong Kong market has demonstrated a robust overall upward trend, with key indices nearing their peaks from the previous yearThis trending upward trajectory highlights not only local economic dynamics but also the broader implications of global market interactions.

The Hong Kong stock market had experienced an extended period of correction since reaching a 2024 high in October of the previous yearAfter a sustained adjustment period lasting over three months, the market appears to have gathered momentum for a significant rebound, as recent indicators suggest a strong push toward recovery.

High Performance of Hong Kong Stocks: Key Indices Near Last Year's Peaks

Overall, the performance of the Hong Kong stock market has been impressive, with the Hang Seng Index rising by 5.29% since February 2025, significantly outpacing other major Asian indices during the same periodIn contrast, the Shanghai Composite Index only rose by 2.08%, while South Korea's KOSPI saw a modest gain of 0.86%, and Japan's Nikkei 225 experienced a decline of 1.95%. The disparity in returns is even more pronounced when viewed in the light of western markets, where the Dow Jones Industrial Average fell by 0.17% during the same timeframe

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Meanwhile, stock performances in the UK, France, and Germany were notably lower than the Hong Kong benchmark.

Indices specific to technology, such as the Hang Seng Tech Index, have shown even more robust growth, reflecting an 8.86% increase since the beginning of FebruaryThe Hang Seng China Enterprises Index also reported a healthy gain of 6.24% within the same period.

Significantly, after a strong performance, key indices in the Hong Kong market have approached their 2024 highs, sparking renewed investor interest and optimismFor instance, the Hang Seng Tech Index briefly surpassed 5300 points, nearing its previous high of 5451.53 points recorded in October 2024.

From a stock-by-stock perspective, leading companies in the Hong Kong market have experienced pronounced upward trendsAmong the top 50 stocks, 15 have exhibited a rebound exceeding 20% since the start of 2025. Notably, major players such as SMIC, BYD, and Alibaba have exceeded 40% in rebounds from their lows in 2025.

Is DeepSeek an Essential Catalyst for Market Strength?

The diverse interpretations surrounding the Hong Kong stock market's upward movement raise questions about the immense influence of technological advancements, particularly DeepSeekSome experts, like those from Galaxy Securities, have suggested that the exuberance around DeepSeek, coupled with stronger-than-expected consumer data stemming from the recent Chinese New Year celebrations, has considerably uplifted investor sentiment, leading to enhancements in market valuations.

Looking further ahead, Galaxy Securities posits that the sustainability of this bullish trend hinges on the underlying economic fundamentals

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There is optimism that as new productive forces develop and policies aimed at stimulating domestic consumption are enacted, corporate earnings within Hong Kong are expected to exhibit steady growthOverall, analysts anticipate a future marked by bullish oscillations.

In terms of sector allocation, Galaxy Securities highlights significant investment opportunities in the tech sectorThe importance of domestic self-sufficiency in technology is becoming increasingly relevant, positioning Chinese companies to capitalize on domestic advancements.

According to recent viewpoints from HSBC, DeepSeek may not only signal a notable technological advancement but could also have broader macroeconomic implicationsIn recent years, investor focus has largely centered on the macroeconomic challenges facing ChinaDeepSeek, however, directs attention to the increasing competitiveness of domestic technological innovations on the global stage, despite prevailing barriers in the USShould DeepSeek’s successes stimulate further innovation within the private sector, this could yield significant breakthroughs in technology, subsequently improving overall investor confidence in the Chinese market.

Interestingly, there seems to be a trend in the Hong Kong stock market where companies associated with DeepSeek experiences tend to exhibit substantial speculative trading and price surges almost immediately.

An illustrative case occurred on February 11, 2025, when Huizhou's Huitongda Network surged nearly 25% within the trading sessionThis volatile increase was triggered by the announcement that Huitongda's "QianCheng Cloud SaaS+" platform had fully integrated with DeepSeekHuitongda emphasized that this not only underscored its status as a leading to-B service platform in China's lower-tier markets but also marked a substantial breakthrough in driving digitization across industries.

Moreover, the market dynamics that unfolded after the steep adjustments following last October's peak have likely set the stage for the current rally, enabling a solid foundation for the upward momentum observed recently.

Major Companies in Hong Kong Lead with Share Buybacks

An important development in the Hong Kong market is the trend of leading companies participating in share buybacks

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