Hang Seng Technology Giants Under Pressure, Southbound Funds Flowing Against the Trend, Southern Fund's Hang Seng Technology ETF Southern(520570) Attracts Market Attention

As of the close on March 2, 2026, the Hang Seng Tech ETF Southern (520570) had a turnover rate of 5.74% with a transaction volume of 158 million yuan. The Hang Seng Tech Index, which it tracks, continues to adjust, with BYD Co. leading the gains against the trend, while SenseTime-W declines. Stocks such as Xiaomi Group-W and JD Health are among the top decliners.

Currently, the Hang Seng Tech Index PE-TTM is 20.93 times, placing it in the 20.4% percentile over the past year, still within a relatively low historical range. Compared to the ChiNext 50 Index (172.74 times) and the Nasdaq 100 Index (33.88 times), the Hang Seng Tech Index has a significant valuation advantage. On the capital front, southbound funds are flowing in against the trend, showing a pattern of buying more as prices fall, with a single-day net inflow exceeding HKD 14.6 billion on February 27. Today (March), southbound funds again surged into the market, with net purchases exceeding HKD 11 billion as of 15:20.

Recently, with foreign investment attracted by Korea and Japan’s hard tech themes, global Halo trading, and the US stock AI scare trade causing Hong Kong software stocks to decline, the index has experienced short-term structural volatility. However, the medium-term recovery logic of the Hang Seng Tech Index remains intact: the impact of AI on SaaS and concerns over food delivery investments are already priced in, with ROI outperforming US stocks; southbound funds continue to flow in, and AI commercialization is accelerating.

China Galaxy Securities believes that the technology sector remains a long-term investment theme in Hong Kong stocks. Concerns about AI have created buying opportunities, and the rise of China’s AI capabilities is expected to boost market confidence. However, a full market confidence recovery still requires time.

The Hang Seng Tech ETF Southern (520570) closely tracks the Hang Seng Tech Index, covering 30 large-cap, highly liquid tech companies listed in Hong Kong, making it an important tool for capturing the trends in the Hong Kong tech sector. The top ten weightings in the index are Semiconductor Manufacturing International Corporation, BYD Co., Alibaba-W, Xiaomi Group-W, Meituan-W, Tencent Holdings, NetEase-S, Kuaishou-W, JD.com-SW, and Baidu Group-SW.

With the Hang Seng Tech Index still at relatively low valuation levels historically, ongoing southbound fund inflows, accelerated AI commercialization, and marginal improvements in policy environment, the long-term recovery potential remains worth monitoring. The off-exchange connect funds for the Hang Seng Tech ETF Southern (520570) are: Class A 020988; Class C 020989.