Mainland Chinese investors continued to increase their net purchases of Hong Kong stocks for a fourth straight month in September, signaling sustained confidence in the city’s equity market despite challenges from rising U.S. Treasury yields and elevated oil prices. According to market data, net inflows via the Stock Connect programme reached HK$60.8 billion in September, a significant rise from HK$10.4 billion in August. Over the third quarter, net buying amounted to HK$134.1 billion.
The increased mainland investment was primarily directed toward technology stocks, with a strong focus on companies involved in artificial intelligence (AI) development. Leading the inflows was Zai, also known as Zhipu, a Chinese AI model developer, which attracted HK$6.94 billion. Baidu, the search engine company behind the Ernie Bot large language model, drew nearly HK$6 billion, while Tencent Holdings received around HK$3 billion in net purchases. In contrast, healthcare stocks faced the largest net selling, driven by an outflow of HK$4.4 billion.
Sector-wise, technology stocks garnered the most interest with net inflows totaling HK$22.6 billion. Industrial firms followed with HK$10.2 billion, while financial companies attracted HK$9.9 billion. Semiconductor Manufacturing International Corp (SMIC), China’s largest chipmaker, experienced significant net selling, amounting to HK$6.4 billion.
The steady inflow of mainland capital into Hong Kong equities helped cushion some of the downward pressure on the market during a period of adverse conditions. The Hang Seng Index declined by 3.7 percent in September amid concerns over rising capital costs and anticipation of further interest rate increases in the United States. Meanwhile, China’s mainland CSI 300 Index saw a sharper fall of nearly 6 percent during the same month.
The buying activity reflects mainland investors’ particular interest in accessing Hong Kong-listed companies that are not available on domestic exchanges. Hong Kong’s market offers exposure to firms with strong AI capabilities, contrasting with mainland markets that remain more concentrated in AI hardware manufacturers. This strategic allocation may underscore evolving investment patterns among mainland participants toward emerging technology trends reflected in Hong Kong equities.