Caution prevails in Hong Kong stock market, institutions recommend focusing on three main themes.

Recently, the Hong Kong stock market has continued to adjust. Since the beginning of this year, the overall Hong Kong stock market has been weak and volatile, with divergent performances in different industry sectors. As of the close on June 23, the Hang Seng Index has fallen by nearly 9%, the Hang Seng Technology Index has fallen by over 20%, and traditional industry sectors such as industrial, comprehensive enterprises, and finance have led the gains. Fund performance has been relatively cautious, with a decrease in net inflows of southbound funds and the amount of buybacks by listed companies compared to the same period last year. According to Wind data, as of June 23, the cumulative net inflow of southbound funds this year has exceeded 300 billion Hong Kong dollars; as of June 22, the buyback amount of Hong Kong-listed companies has exceeded 85 billion Hong Kong dollars. Institutional investors believe that the main driving force behind the current decline in Hong Kong stocks may come from the increase in short-selling pressure, rather than selling pressure from long positions. The central reversal still depends on the progress of large-cap AI and consumer recovery catalysts, which may not be at the right time yet. Investors should focus on three main themes, including oversold sectors, high dividend and dividend assets, and the technology sector.