Hong Kong equities fell on Monday as a violent sell‑off in precious metals rippled through commodity names and profit‑sensitive sectors bore the brunt of a risk‑off move. The Hang Seng Index closed down 2.23%, while the Hang Seng TECH Index slid 3.36%, with chip, auto and telecom names among the heaviest decliners.
Gold and silver prices plunged in global spot trading during the session, erasing recent gains and inflicting steep declines on miners listed in Hong Kong. Major gold producers such as Shandong Gold and Chifeng Gold each lost more than 12%, Lingbao Gold slid over 8%, and China Silver Group fell more than 8% as bullion and industrial‑metal sentiment deteriorated sharply.
Semiconductor stocks also weakened amid the broader risk aversion: Hua Hong Semiconductor plunged over 11%, flash‑memory and IC designer Gigadevices (Zhaoyi Xinchuang) dropped roughly 9%, and China Semiconductor Manufacturing International Corporation (SMIC) eased around 4%. The move compounded recent pressure on cyclical and growth‑oriented technology names in the city.
The auto sector was similarly hit by the risk‑off trade, with marquee electric‑vehicle makers retreating. BYD declined nearly 7% and Xpeng more than 6%, amplifying concerns over earnings visibility and investor appetite for high‑beta manufacturing stocks as markets grapple with volatility.
Telecommunications shares were notably weak after Beijing adjusted the tax treatment of telecom value‑added services, raising the applicable VAT rate from 6% to 9%. The three big operators—China Unicom, China Telecom and China Mobile—fell in sympathy, down about 6%, 5% and 2% respectively, as markets priced in a direct hit to margins and revenue from the tax increase.
Monday’s moves in Hong Kong came against a backdrop of similar weakness elsewhere in Asia and Europe, where commodity‑linked indices and basic materials stocks registered heavy losses. The speed and scale of the metals sell‑off—echoed by reports of outsized intraday moves in silver—helped convert what might have been a contained correction into a broader equity repricing.
For investors, the session underscores two interacting themes: first, that commodities can rapidly reverse and transmit stress to mining equities and banks exposed to commodity financing; and second, that policy‑level changes—like the VAT adjustment for telecom value‑added services—can produce immediate, measurable pressure on large, otherwise defensive utilities and telcos. Both dynamics increase near‑term volatility and complicate earnings forecasts for affected sectors.
Looking ahead, market participants will watch whether the metals rout stabilises, whether Beijing offers any further clarity on tax timing or compensatory measures for operators, and how corporate earnings and guidance may be revised in response. Until those factors firm up, Hong Kong’s equity market is likely to remain under pressure from rapid sentiment swings and headline‑driven reallocations.