<div id="readability-page-1"><div>BOCI recently published a report stating that since 2026, net inflows from Southbound trading have slowed, while the HSTECH has come under pressure amid escalating geopolitical risks. As of April 21 this year, the average daily turnover of Hong Kong stocks reached HKD272.5 billion, higher than HKD254.2 billion in the same period last year and the full-year 2025 average of HKD249.7 billion. As of April 21, the HSI rose 3.34%, while the HSTECH fell 8.24%. The Hang Seng China AH Premium Index declined from 123.46 on December 31, 2025 to 117.44 on April 21, 2026, implying that A-shares traded at an average premium of 17.44% over H-shares.The broker noted that since the beginning of this year, Southbound trading recorded net inflows of RMB215 billion, down 62.1% YoY, mainly due to a high base in the first four months of 2025. Overall, inflow momentum of Southbound trading in 2026 remains resilient and continues to play an important role in boosting investment sentiment and shaping stock selection strategies. Over the years, Mainland-related companies have gradually taken a dominant position in the Hong Kong stock market.According to HKEX data, as of the end of March 2026, Mainland-related companies accounted for 78.63% of total market capitalization and 89.73% of total turnover. As of April 21, Southbound trading accounted for 20.79% of Hong Kongs average daily turnover, compared with 23.36% in 2025, 17.3% in 2024, 14.1% in 2023 and 11.8% in 2022.Looking ahead, the broker expects strong demand from Mainland investors for Hong Kong equities via Southbound trading to persist in 2026, supported by a broader selection of high-quality technology and high-end manufacturing stocks, attractive valuations of Hong Kong shares and high dividend yields. Southbound trading will become an important driver of the Hong Kong markets long-term potential re-rating. Investment behavior data show that Southbound investors are focusing on the internet, new consumption and semiconductor sectors.BOCI recommended investors pay attention to the following actively traded Southbound stocks: TENCENT (00700.HK) -3.800 (-0.794%) Short selling $533.56M; Ratio 8.546% : consolidating core competitiveness amid the AI wave, with continued strategic execution and flexible shareholder return plans; XIAOMI-W (01810.HK) -1.020 (-3.280%) Short selling $1.06B; Ratio 40.148% : actively investing in AI, robotics and chips, with potential short-term results and long-term development of a &#34;Human ?Car ?Home&#34; AI ecosystem; POP MART (09992.HK) -3.000 (-1.922%) Short selling $292.54M; Ratio 32.626% : continuously enhancing efficiency, optimizing its supply chain and monetizing IP to lay a foundation for long-term growth; ALIBABA-SW (09988.HK) -3.500 (-2.688%) Short selling $487.83M; Ratio 11.279% : firmly increasing investment to achieve medium- to long-term goals for its cloud business and fast retail; KUAISHOU (01024.HK) -1.340 (-3.071%) Short selling $256.91M; Ratio 27.858% : stepping up AI investment, strengthening the advantages of Kling, and enhancing commercialization and integration of its content ecosystem; HUA HONG SEMICONDUCTOR (01347.HK) -1.500 (-1.309%) Short selling $311.89M; Ratio 16.050% : may enter a cycle of rising average selling prices in 2026, with upside pricing potential for 12-inch products. (wl/u)(HK stocks quote is delayed for at least 15 mins.Short Selling Data as at 2026-04-28 12:25.)</div>This article was automatically translated by AI, the Chinese version should be considered the authoritative version. AASTOCKS.com Limited does not guarantee its accuracy or completeness and accepts no liability for any damages or losses arising from the use of this translation.</div>

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BOCI's report indicates a slowdown in Southbound net inflows, down 62.1% YoY to RMB215 billion, amid geopolitical tensions. Despite this, Hong Kong's average daily turnover increased to HKD272.5 billion. The HSI rose 3.34%, while the HSTECH fell 8.24%. Mainland-related companies dominate the market, comprising 78.63% of market cap. BOCI anticipates sustained demand from Mainland investors, particularly in technology and manufacturing sectors. Recommended stocks include TENCENT, XIAOMI, POP MART, ALIBABA, KUAISHOU, and HUA HONG SEMICONDUCTOR, focusing on AI and growth strategies.

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BOCI: Southbound Net Inflows Slow YTD, Focus on Internet, New Consumption and Semiconductor Sectors