Since the beginning of this year, the cumulative net inflow of southbound funds has exceeded HKD 900 billion for the first time

According to statistics, this week, the net inflow of southbound funds was HKD 21.751 billion, a decrease of 63.15% week-on-week. Since the beginning of this year, the cumulative net inflow has reached HKD 900.8 billion, surpassing HKD 900 billion for the first time. Bank of China International's research report believes that with the continuous deepening of the Hong Kong Stock Connect system, southbound funds from the mainland have become an important source of incremental funds for the Hong Kong stock market, particularly favoring Chinese concept stocks that have a Chinese background and align with the direction of the new economy. Compared to the institutional suppression of Chinese concept stocks in the U.S. stock market regarding information disclosure and audit compliance, the Hong Kong stock market is seen as a more institutionally inclusive and policy-secure capital haven, thus forming certain valuation premium expectations. In terms of net buying amounts, large technology stocks have all seen increased holdings from southbound funds. Among them, Alibaba-W received the highest net buying amount from southbound funds this week, reaching HKD 3.339 billion, and has seen an increase in holdings from southbound funds for four consecutive weeks, with the latest holdings amounting to 1.579 billion shares, accounting for 8.26% of the total shares in the Hong Kong stock market. Additionally, Tencent, Xiaomi Group-W, and SMIC all had net buying amounts exceeding HKD 1 billion