Hong Kong stocks fell across major indices on Friday as AI and technology sectors experienced sharp declines. The Hang Seng Index dropped 1.78% to close at 24,562.24 points, while the Hang Seng Tech Index plunged 4.37% to 4,623.17 points and the H-shares Index declined 2.18%. The selloff was triggered by concentrated position unwinding in AI-related stocks, with Zhipu leading losses at a 28.49% decline. Analysts attributed the downturn to investors liquidating overcrowded positions in AI computing and memory chip themes rather than fundamental demand collapse, as July marks a period when pricing logic shifts from scarcity premiums to commercialization verification for AI model companies.
Zhipu Leads AI Sector Decline with 28.49% Single-Day Drop
The AI application sector collectively declined, with Zhipu plummeting 28.49% to close at HK$1,107, recording turnover of HK$17.93 billion to top Hong Kong's trading volume chart. MiniMax fell over 15%, while Zhida Technology dropped over 19%. Major technology stocks also declined, with Kuaishou falling 7.76%, Tencent Holdings down 4.63%, Alibaba declining 3.68%, and Meituan dropping 4.07%.
Semiconductor Stocks Fall as SMIC Drops 9.97%
The semiconductor sector declined in tandem with AI stocks. SMIC fell 9.97%, while Hua Hong Semiconductor dropped 11.88%. Memory concept and PCB (printed circuit board) sectors also retreated, with GigaDevice declining over 11%. Kingboard Laminates fell over 14% due to profit-taking.
Shipping and Utilities Sectors Outperform Amid Market Decline
Defensive sectors and industries with fundamental support moved against the broader market trend. The shipping and port sector performed strongly, with Orient Overseas International rising 2.91%, supported by volume and price increases and Red Sea situation variables. Utilities such as power and banking sectors remained relatively active, with HK Electric rising 3.01%, indicating capital rotation toward low-valuation defensive stocks during market volatility.
Haitong International and CITIC Securities Provide Market Outlook
Haitong International analysts stated that July is the period when lock-up uncertainties are resolved, and pricing logic for AI large model companies is transitioning from scarcity premiums to commercialization validation. Despite short-term adjustments, the AI rally is expected to resume and expand to broader industry chains as overseas liquidity pressures ease in August. CITIC Securities recommended investors focus on AI infrastructure manufacturers with order delivery capabilities and application opportunities that have realized commercial value.
FAQ
What caused Hong Kong stocks to fall on Friday?
Hong Kong stocks declined as AI and technology sectors experienced sharp selloffs, with the Hang Seng Index dropping 1.78% to 24,562.24 points. The decline was triggered by concentrated position unwinding in AI-related stocks rather than fundamental demand collapse, according to analysts.
How much did Zhipu fall on Friday?
Zhipu plunged 28.49% to close at HK$1,107, with turnover of HK$17.93 billion, making it the top traded stock in Hong Kong on Friday. Other AI stocks including MiniMax and Zhida Technology also experienced significant declines.
Which sectors outperformed during the Hong Kong stock market decline?
Defensive sectors including shipping, utilities, and banking outperformed the broader market. Orient Overseas International rose 2.91% and HK Electric gained 3.01%, indicating capital rotation toward low-valuation defensive stocks during market volatility.
