Hang Seng Index jumps 2.4% to recapture 24,000 as tech stocks rally

Hong Kong stocks surged Friday, with the Hang Seng Index reclaiming the 24,000-point mark after a weaker-than-expected US jobs report dampened Federal Reserve rate hike expectations and triggered a broad regional tech rebound.

The Hang Seng Index jumped 2.38%, or 560 points, to 24,057, recapturing the 24,000 level as technology and semiconductor stocks led a broad rally.

"The combination of relief after the payrolls data, a reversal of the chip stock selloff and yen volatility are the main narratives driving Asian markets," said Kathleen Brooks, research director at XTB trading group.

The Hang Seng Tech Index surged 4.34% to 4,702. Semiconductor stocks led gains, with Tianshu Zhixin (天数智芯) jumping 11%, Hua Hong Semiconductor (华虹宏力) rising more than 8%, and SMIC (中芯国际, 0981.HK) climbing over 7%. Among heavyweight tech names, Alibaba Group (阿里巴巴, 9988.HK) advanced 8%, Xiaomi Corp. (小米集团, 1810.HK) added 5.63%, Baidu Inc. (百度, 9888.HK) gained 4.7%, Tencent Holdings (騰訊控股, 0700.HK) rose 3%, and JD.com (京东, 9618.HK) edged up nearly 3%. Half-day turnover reached HK$188 billion.

The rally followed US data Thursday showing the economy added fewer than half the jobs forecast in June, with prior months revised lower — reducing the likelihood of a Fed rate hike this year and easing pressure on global borrowing costs. The shift in rate expectations has weakened the US dollar and supported capital flows into Asian equities, though some analysts caution that a rate increase before year-end remains possible.

Regional Markets Join the Rally

The broader Asian session mirrored Hong Kong's gains. South Korea's Kospi index soared 5.76% to 8,088, recovering from a 20% peak-to-trough correction, as Samsung Electronics surged 8.2% and SK Hynix skyrocketed 10.9%. Japan's Nikkei 225 climbed 1.47% to 69,744, while Australia's S&P/ASX 200 rose 1.37% to 8,844.

On the mainland, the Shanghai Composite Index edged up 0.52% to 4,011, and the Shenzhen Composite added 0.08% to 15,237, as a private survey showed China's services activity eased less than expected in June.

The move was set in motion by US data where weak payrolls prompted traders to reduce bets on a Federal Reserve interest-rate increase. The US dollar headed for its biggest weekly drop in nearly three months, while gold rose toward $4,200 an ounce. The yen recovered some ground after touching a 40-year low against the dollar earlier in the week.

"The US labor market today is not strong enough to instigate rate hikes but importantly is no longer a handbrake or impediment to hikes," said Rodrigo Catril, analyst at National Australia Bank.

European indices also rose, with Trade Nation analyst David Morrison noting that lower US rate expectations reduce the risk of capital flowing away from Europe toward higher-yielding US assets.

This article is for informational purposes only and does not constitute investment advice.