Market Overview - The Hong Kong stock market experienced significant volatility, with the Hang Seng Index showing a "V" shape reversal before declining again, closing down 3.97% for the week at 25,247.1 points, while the Hang Seng Tech Index fell 7.98% to 5,760.38 points [3][4] - The market's reaction is interpreted as a typical "TACO trade," suggesting that President Trump's hardline stance may eventually soften [3] Sector Performance - Amidst market fluctuations, defensive sectors such as banking and insurance gained investor interest, with Agricultural Bank of China rising over 1% and its market capitalization surpassing 2.6 trillion yuan [4] - Analysts noted a rotation in sectors, with previously high-performing tech stocks undergoing significant adjustments, while undervalued high-dividend sectors like banks and utilities saw gains, indicating a shift in investor risk appetite [4][5] Investment Sentiment - Analysts suggest that in light of external uncertainties, investors may focus on defensive sectors, particularly Chinese financial and consumer stocks, as well as high-yield stocks in the short term [5] - The long-term investment value of Hong Kong stocks is becoming apparent, with some analysts viewing current market conditions as an opportunity for entry [6] Capital Flows - Southbound capital showed a contrary trend, with net purchases amounting to 38.786 billion HKD from October 13 to October 16, indicating continued interest in Hong Kong stocks despite market volatility [6] - Analysts believe that the Chinese stock market's valuation remains significantly lower than that of U.S. tech companies, suggesting substantial potential for future capital inflows as global institutional investors begin to allocate more to Chinese equities [7]