The Hong Kong stock exchange opened lower on Tuesday, following negative pressure in global markets as investors reassessed the valuation of the artificial intelligence (AI) sector and awaited the direction of US interest rate policy.
The Hang Seng Index (HSI) fell around 1.3% at the start of the session, moving to around 26,027 points. This decline extended the correction trend in the Asian region, in line with the decline on Wall Street.
The technology sector was again the biggest drag on the index, with shares of giants such as Xiaomi, Li Auto, and Meituan each falling between 2% and 3%.
Pressure also came from major commodity issuers. China Hongqiao Group Limited plunged around 6.8% after announcing plans to issue new shares, triggering investor selling.
Market participants are closely monitoring developments in the US Federal Reserve's monetary policy, as uncertainty over the timing of interest rate cuts remains a major drag on optimism. Investor uncertainty over the perceived overvaluation of the AI sector also contributed to the worsening trading trend.
"The Fed's policy outlook and the correction in the global AI sector have prompted investors to exercise caution. Market direction remains vulnerable to external pressures," read this morning's market report.
Trading volume at the opening session also weakened, in line with the downward trend in indices in other Asian regional markets.
Source: Newsmaker.id
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