Baidu, Meituan, JD.com jump as Hong Kong stocks record fresh 4-year high
News Summary
Hong Kong stocks hit a four-year high on Wednesday, with the Hang Seng Index adding 1.8% to 26,908.39, marking its highest close since July 23, 2021. Technology firms led the surge, as the Hang Seng Tech Index jumped 4.2%. Investors were betting on artificial intelligence (AI) innovations, while Chief Executive John Lee Ka-chiu's policy address boosted sentiment for supportive measures. Specifically, search-engine giant Baidu soared 15.7% to HK$131 after global equity research firm Arete Research Services raised its rating to buy, and Goldman Sachs analysts indicated its AI model showed potential to surpass DeepSeek. Food-delivery provider Meituan gained 4.9%, JD.com advanced 5.2%, Alibaba Group Holding added 5.3%, and WeChat operator Tencent rose 2.6% after announcing it raised 9 billion yuan (US$1.3 billion) in an offshore yuan bond deal. However, some firms like Zijin Mining Group, Pop Mart International, and Henderson Land Development saw declines. Eva Lee, head of Greater China equities at UBS Global Wealth Management, noted that China's internet leaders are accelerating AI monetization, backed by domestic chip development and large language model innovation.
Background
In September 2025, the robust performance of Hong Kong stocks reflects investor optimism in the technology sector, particularly in artificial intelligence. This four-year high for the Hang Seng Index indicates a significant recovery from the deep corrections experienced in late 2021 through 2022, when Chinese tech stocks faced stringent regulatory crackdowns and macroeconomic headwinds. Policy addresses by the Hong Kong Chief Executive typically outline government priorities for economic development, social welfare, and specific industry support. The current address boosted market sentiment, suggesting potential policy measures to further support Hong Kong's economy and financial markets. Furthermore, mainland China's continued investment in AI and semiconductor development provides a crucial strategic backdrop for domestic tech companies, especially amid potential tightening of technology export controls by the US Trump administration (despite President Trump's re-election in 2024, his technology policy towards China remains a key uncertainty).
In-Depth AI Insights
Is the current market optimism towards Hong Kong tech stocks merely a short-term reaction to AI narratives and policy statements, or are deeper structural changes at play? - On the surface, AI innovation and policy support are immediate catalysts. However, deeper drivers likely include the Chinese government's long-term strategy to achieve "self-reliance" and "technological autonomy" in semiconductors and large AI models. - Against a backdrop of ongoing U.S. technology restrictions, Chinese tech giants are compelled to accelerate internal R&D and ecosystem building. This could be fostering a more resilient and self-sufficient growth model. - Investors may be beginning to recognize the long-term value derived from this "forced" transformation, leading to less reliance on external technologies and thus reduced geopolitical risk exposure. How might the accelerated AI monetization by China's internet giants reshape competitive landscapes and profitability models within the industry in the long term? - AI monetization is more than just a technological upgrade; it represents a strategic shift in profitability models. It likely signals a move from a "burn cash for growth" mentality towards a greater focus on efficiency gains and profit generation enabled by technology. - Companies with early AI adoption, strong infrastructure, and data accumulation, such as Baidu and Tencent, stand to gain significant first-mover advantages, potentially solidifying their market leadership and creating higher barriers to entry for latecomers. - This shift could lead to a stronger "winner-take-all" dynamic within the industry, with resources and talent further concentrating among leading AI players, putting greater competitive pressure on smaller enterprises. Considering the continued tenure of the Trump administration, does this rally in Hong Kong and mainland Chinese tech stocks face potential external risks? - The Trump administration has consistently pursued strong technological and trade policies against China. While the market is currently optimistic due to domestic AI development and policy support, the risk of new U.S. sanctions or export control measures cannot be ignored. - Any further restrictions targeting Chinese AI chips or critical technology supply chains could impact the R&D progress and commercialization prospects of relevant companies, even amidst ongoing domestic self-sufficiency efforts. - Furthermore, the overall trajectory of U.S.-China relations, and the potential for financial decoupling, remains a Sword of Damocles hanging over Hong Kong and mainland Chinese markets, capable of influencing investor sentiment and capital flows at any time.