Core Viewpoint - Hong Kong Stock Exchange is exploring a plan to lower the threshold for investors to purchase high-priced stocks, aiming to stimulate trading activity [1][2] Group 1: Market Conditions - The Hong Kong stock market has seen a significant adjustment recently, with 37 stocks priced over HKD 100 per share, including notable companies like Tencent and BYD [2] - The minimum trading unit for stocks varies from 100 shares to several thousand, depending on the company [2] - A reduction in the purchase threshold for high-priced stocks could enhance trading activity and positively impact the short-term performance of the Hong Kong Stock Exchange [2] Group 2: Market Dynamics - According to Tianfeng Securities, the market breadth of the Hang Seng Index has improved, with the percentage of stocks above the 20-day moving average rising from 22.9% to 90.4% [3] - However, the current market rally lacks broad participation, with only two sectors, Information Technology (+34.7%) and Consumer Discretionary (+32.1%), outperforming the Hang Seng Index [3] - The Hang Seng Technology Index's rolling 10-day trading volume once exceeded 40%, indicating a concentration of capital in a few sectors and potential overheating [3] Group 3: Fund Flows - Hedge funds saw significant inflows into Chinese equity assets in early February, but subsequently reduced their holdings over the following weeks, indicating volatility in trading [4] - Domestic capital has played a stabilizing role in the Hong Kong market, with cumulative net inflows from southbound trading exceeding HKD 4 trillion since the launch of the Hong Kong Stock Connect [4] - The allocation of southbound funds shows a "dumbbell" strategy, investing in both high-growth assets and high-dividend stocks for risk hedging [4] Group 4: Foreign Investment Sentiment - Foreign investment banks maintain a positive outlook on the Hong Kong market, noting its strength despite external market fluctuations [5] - A shift in global capital flows is observed, with a trend moving away from U.S. assets due to concerns over tariffs and economic downturns, benefiting markets in Europe and Asia [6] - The current market environment may lead to a concentration in technology growth stocks as the market adjusts [6]