EB Securities: Hong Kong stock market expected to continue to recover, focus on technology sector.

EB SECURITIES released a research report stating that the Hong Kong stock market rebounded in April, but the market as a whole is still in a phase of repair. Domestic policies continue to be strengthened, continuously releasing positive signals; at the same time, external disruptions are gradually diminishing. The overall situation of the US-Iran conflict is showing a cooling trend, and the US stock market has continued to fluctuate upwards recently, continuously setting new historical highs. With the combined impact of internal and external positive factors, the Hong Kong stock market is expected to continue to recover. The catalysis of the AI industry chain continues, with hardware, cloud computing, and internet applications all showing increasing prosperity. With expectations of both performance recovery and valuation doubling, Hong Kong's technology sector has the potential for mid-term cost-effective allocation, making it a high-quality position in the current technology sector. EB SECURITIES main observations are as follows: April A-shares and Hong Kong stocks generally rebounded In April, major A-share indices generally rose, with more industries rising than falling, and electronics, communications, and construction materials leading the way. Influenced by improved market sentiment, increased risk appetite, etc., as of the 28th of April, the major A-share indices rebounded, with the SCI-Tech Innovation 50 Index showing the largest increase, rising by 18.5% in April, while the SSE 50 Index showed the smallest increase, rising by 4.4%. The Hong Kong stock market rebounded in April. Due to the easing of geopolitical conflicts, rising global markets, improved market sentiment, among other factors, the overall trend of the Hong Kong stock market fluctuated upwards in April. As of April 28, 2026, the Hang Seng Hong Kong 35 Index, Hang Seng Composite Index, Hang Seng Technology Index, Hang Seng Index, and Hang Seng H-Share Index ETF Index rose by 5.4%, 3.9%, 3.8%, 3.6%, and 3.2% respectively. A-share perspective: focus on the certainty of fundamentals The market is expected to continue its upward trend. On one hand, although the geopolitical tensions in the Middle East continue, the uncertainties have gradually diminished, with investors becoming less reactive to any changes. On the other hand, as the earnings season comes to an end, the uncertainties brought by earnings disclosures will decrease. Companies that exceed expectations in performance may receive a premium in valuation, while those that fall short will face risks. Overall, the A-share market may continue its pattern of fluctuation upwards. In terms of structure, it is recommended to focus on sectors with improving fundamentals, such as hard technology, export chains, and resource sectors. Sectors such as hard technology, export chains, and resources may see ongoing improvements in fundamentals and deserve investors' attention. In hard technology, focus on the electronics and communications industries; in the export chain, pay attention to sectors such as electric power equipment, mechanical equipment, household appliances, light manufacturing, and automobiles; in upstream resource sectors, focus on industries such as petroleum and petrochemicals, basic chemicals, non-ferrous metals, and coal. Hong Kong stock perspective: expected continued recovery, with a focus on technology The Hong Kong stock market is still in a phase of repair. On one hand, domestic policies continue to be strengthened, continuously releasing positive signals. During the April political meeting, it was pointed out that existing macro policies should be used effectively and incrementally to respond to uncertainties externally. On the other hand, external disturbances are gradually diminishing. The overall situation of the US-Iran conflict is showing a cooling trend, with the US stock market recently continuing to fluctuate upwards and setting new historical highs. With the combined impact of internal and external positive factors, the Hong Kong stock market is expected to continue its recovery. In terms of allocation, there is a focus on the technology sector. Currently, the valuation of Hong Kong's technology sector is low, negative factors have been exhausted, capital inflows are increasing, and there is a resonance from the catalyst of AI, highlighting its value in allocation. The catalysis of the AI industry chain continues, with hardware, cloud computing, and internet applications all showing increasing prosperity. With expectations of performance recovery and valuation doubling, Hong Kong's technology sector has the potential for mid-term cost-effective allocation, making it a favorable position in the current technology sector. Risk warning: Policies may not progress as expected; US-Iran tensions may worsen significantly; unforeseen risk events may occur.