The Hang Seng Index has come under pressure in the past few weeks as Hong Kong’s technology companies plunged. It dropped to a low of $26,300, down by over 5% from its highest level this year.
Hang Seng technology stocks are crashing
The Hang Seng Index has pulled back as many technology stocks continue their freefall this year amid valuation and AI concerns.
Trip.com stock has plunged by 21% this year making it the worst performer in the Hang Seng Index this year. NetEase stock dropped by 13%, while Xiaomi, Meituan, Tencent, and Jd have plunged by over 5% this year.
The closely-watched Hang Seng Tech Index crashed to $5,300, down by 20% from its highest level in September last year, meaning that it has now entered a bear market.
The ongoing crash also mirrors that of American technology companies, which have slumped sharply this year, erasing billions of dollars in value. NVIDIA’s stock price dropped to $170, down by 20% from its highest level in 2025.
Similarly, Palantir’s stock price dropped to $130 from the all-time high of $208., a move that has erased billions of dollars in value. Microsoft dropped to $393 from the all-time high of $553.
Software stocks like ServiceNow, Intuit, Oracle, and Atlassian have been the most affected, with many of them falling by over 50% from their all-time highs.
Meanwhile, value stocks in the Hang Seng Index are doing better. Sun Hung Kai Properties’ stock soared by 32% this year after China hinted that it would remove the three red lines in the property market. The three rules included features on the liability-to-assets, debt-to-equity, and cash-to-short-term debt ratio.
Xinyi Glass jumped by 29%, while Pop-Mart, China Life Insurance, MTR Corporation, and CK Hutchinson rose by over 20% this year.
This rotation from growth to value is happening in the United States, where popular value ETFs like the Schwab US Dividend Equity ETF (SCHD) and the Vanguard Value ETF (VTV) have jumped to a record high.
The technology stocks in the Hang Seng Index are also plunging after China announced some tax increases in the country. China announced a VAT increase on internet services like games and e-commerce.
The Hang Seng Index also reacted to a potential attack on Iran. In a statement, the US Virtual Embassy in Iran issued a security alert asking US citizens in Iran to leave the country, a sign that Trump plans to attack the country, a move that Iran has warned threatens a regional war.
Hang Seng Index technical analysis
The daily timeframe chart shows that the Hang Seng Index crashed from a high of $28,075 earlier this year to the current $26,580. It dropped below the key support level at $27,425, its highest level in October last year.
The Supertrend indicator has flipped from green to red, while most oscillators have continued moving downwards this year.
Therefore, the most likely scenario is where the index continues falling, with the next key target being the psychological level at $26,000.
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