[True Insight Institutional View] Policy tailwinds support the market; Southbound Stock Connect recorded a net inflow of HKD 4.81 billion on Wednesday.

Frequent policy tailwinds, with the State Council strongly promoting AI strategy and new quality productive forces, coupled with the central bank reiterating its accommodative monetary stance, provide a floor for market sentiment. Although the slight rise in January CPI and the narrowing decline in PPI indicate a slight easing of deflationary pressure, the strength of domestic demand recovery remains to be verified. Affected by the overnight pullback in Chinese concept stocks and the rebound in U.S. Treasury yields, the upward momentum of the broader market may be temporarily limited. Capital is expected to rotate between AI tech themes and defensive sectors. Investors are advised to focus on the details of policy implementation and subsequent signals of liquidity release.

Stock Connect (for Hong Kong) recorded a net inflow of HKD 4.81 billion on Wednesday, with $TENCENT(00700.HK) recording the largest net inflow of HKD 730 million, followed by Zijin Mining International (02259.HK); $BABA-W(09988.HK) recorded the largest net outflow of HKD 520 million, followed by SMIC (00981.HK).

Source: KGI Securities