Stock Market in Hong Kong anticipated to open with momentum to the positive side
=====================================================
In a positive turn of events, Asian markets have been experiencing growth, particularly in the technology sector. This trend is particularly evident in Hong Kong, where tech companies are reporting moderate revenue growth, driven by artificial intelligence (AI) and gaming.
Super Micro Computer (SMCI), a Hong Kong-based tech company, reported mixed third quarter results. However, another Hong Kong-based tech company, ASMPT, bucked the trend with a 1.8% year-over-year increase in Q2 2025 revenue, reaching HK$3.40 billion (US$436.1 million). The growth was driven by strong AI-related demand, with bookings rising 20.2% year-over-year and operating profit growing 25.4% year-over-year.
Tencent, another major Hong Kong-listed tech conglomerate, is expected to announce its Q2 2025 earnings soon. Investors will be watching for continued growth in gaming revenues and AI initiatives. Tencent's Q1 results showed impressive revenue growth (17% YoY in value-added services), driven by popular games and expanding user engagement, although net profit missed estimates.
Silicon Motion, another Hong Kong-based semiconductor company, also posted strong Q2 earnings.
The positive earnings trends and strong AI-driven demand in these influential Hong Kong-listed technology companies are supporting upward momentum in the Hang Seng Index. The index, which has a significant weighting in tech stocks, has been performing well, with the Hang Seng Index currently above the 24,910-point plateau.
The global technology earnings, particularly in AI and communication services, are outperforming expectations. The Information Technology sector is growing revenue at approximately 22% year-over-year, significantly above forecasts, and is a leading contributor to broader market gains.
Other Asian technology players, such as China XLX, are also reporting strong performances. China XLX reported a 16.7% quarter-over-quarter increase in Q2 revenue, supported by higher sales volumes and product prices.
The news about Apple's $100 billion investment plans to expand its U.S. operations has also helped to lead the markets higher.
In other news, the European and U.S. markets were up on the previous day. The Dow, NASDAQ, and S&P 500 all closed higher on Wall Street, with the Dow improving by 0.18 percent, the NASDAQ by 1.21 percent, and the S&P 500 by 0.73 percent. Strong earnings news from McDonald's and Shopify benefitted the markets.
However, potential U.S. sanctions on Russia's oil exports could impact crude oil prices, with crude oil for September delivery down $0.96 or 1.47 percent at $64.20 per barrel.
In summary, the Asian markets are experiencing growth in the technology sector, particularly in Hong Kong, driven by AI and gaming. The positive earnings trends and strong AI-driven demand in these influential Hong Kong-listed technology companies are supporting upward momentum in the Hang Seng Index, contributing to the index's resilience and potential gains.
The financial sector in Asian markets, particularly in Hong Kong, is bolstered by the robust performance of tech companies, with ASMPT and Tencent leading the way, driven by strong AI-related demand. Silicon Motion also posted strong Q2 earnings, further supporting the upward momentum in the Hang Seng Index.
The global finance industry is flourishing, with the Information Technology sector growing revenue at approximately 22% year-over-year, primarily fueled by AI and communication services, boosting broader market gains.
