Core Viewpoint - The Hong Kong Stock Exchange is exploring a plan to lower the investment threshold for purchasing high-priced stocks to stimulate trading activity, which could positively impact the short-term performance of the exchange's stock [1][2]. Group 1: Market Activity and Trends - As of March 9, the average daily trading volume of Hong Kong stocks has exceeded 200 billion HKD this year, with February seeing three instances of daily trading surpassing 400 billion HKD, equating to four times the average daily trading volume for 2023 [2]. - The net inflow of mainland funds into Hong Kong stocks has surged, with cumulative net inflows reaching 339.5 billion HKD since the beginning of 2025, nearly quadrupling compared to the same period last year [2]. - On March 10, net purchases by mainland funds reached a record high of 296.26 million HKD, marking the highest daily net inflow since the launch of the Stock Connect mechanism [3]. Group 2: Sector Performance - The Hang Seng Index has shown significant growth, reaching a high of 24,669.6 points, while the Hang Seng Technology Index has outperformed globally with a maximum increase of over 40% [3]. - The market breadth of the Hang Seng Index has improved, with the proportion of stocks above the 20-day moving average rising from 22.9% to 90.4% as of March 7, indicating a strong upward trend, although it has not reached the levels seen in previous market rallies [4]. Group 3: Investment Strategies and Recommendations - The Southbound capital flow has demonstrated a "dumbbell" configuration, with investments concentrated in high-growth sectors such as consumer internet and technology, while also increasing holdings in high-dividend sectors like finance and energy for risk hedging [5]. - The proportion of active equity funds holding Hong Kong stocks has increased to 6.6% as of the end of February 2025, reflecting a growing interest from domestic public funds in the Hong Kong market [6].