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Can Hong Kong stocks contend with wild swings without help from state hands?
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Zhang Shidongin ShanghaiPublished: 1:00pm, 10 Sep 2026
As concerted state buying puts a floor under mainland China’s onshore stock market amid Beijing’s stabilisation measures, investors in Hong Kong worry about coping with high volatility at a delicate time, with multiple market-roiling factors.
These include geopolitical tensions, sluggish earnings growth, a stumbling artificial intelligence trade, possible US tightening and a looming supply glut from expiring share lock-ups.
Investor worries also grew after renewed military strikes in the Middle East sent oil prices above US$100 a barrel, while Washington’s latest initiative to buy up to US$6 billion worth of long-end Treasuries failed to stem bond-market sell-offs.
A possible unwinding of the Japanese yen-financed carry trade may also weigh on Hong Kong stocks, which remain vulnerable to overseas flows, after heightened expectations that the Bank of Japan would accelerate interest-rate increases. The shift could trigger sell-offs in assets bought with borrowed cheap Japanese currency.
“State intervention may iron out volatility and provide liquidity to stabilise [mainland] stocks, at least in the near term,” said Dai Ming, a fund manager at Huichen Asset Management. “The Hong Kong market is now to some extent marginalised, because of poor liquidity.”
The Hang Seng Index fell 1.3 per cent by the midday break on Thursday, taking cues from global caution about risk assets amid elevated Treasury yields and crude prices.
The benchmark was heading for its biggest decline in two weeks, while mainland equities reacted more mildly, with the CSI 300 Index edging 0.3 per cent lower.
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