Hong Kong stocks climbed to a two-month high on Thursday as easing concerns over Middle East tensions boosted investor confidence and lifted technology shares across the market.
The Hang Seng Index rose 1.6% to close at 26,626.28, its highest level since late February, while the Hang Seng Tech Index surged 3.1%. Mainland Chinese markets also advanced, with both the CSI 300 Index and Shanghai Composite Index gaining 0.5%.
Investor sentiment improved after reports suggested the United States and Iran were moving closer to a framework that could ease hostilities and reopen the Strait of Hormuz, one of the world’s most critical oil shipping routes. The reports also indicated that discussions over Iran’s nuclear programme could follow, although no agreement has been finalised.
Falling oil prices added to market optimism by reducing fears of inflation and tighter monetary policy. Analysts said investors increasingly viewed any potential de-escalation in the Middle East as supportive for global equities and economic growth.
Gary Dugan, chief executive of The Global CIO Office, said markets were beginning to interpret easing geopolitical tensions as “disinflationary,” a shift that has supported risk assets including equities and currencies.
Technology companies led gains in Hong Kong. Alibaba Group and Baidu were among the major stocks advancing as investors returned to growth-focused sectors tied to artificial intelligence and digital infrastructure spending.
The latest rally extends a broader recovery in Hong Kong equities that has gathered momentum in recent weeks. Investors have increasingly rotated back into Asian markets amid expectations that geopolitical tensions could cool and oil supply disruptions may ease.
Earlier spikes in crude oil prices had rattled regional markets, especially in Asia where economies remain heavily dependent on energy imports passing through the Strait of Hormuz. Rising tensions had previously fuelled concerns about inflation, supply chain disruptions and slower global growth.
Analysts say any sustained diplomatic breakthrough in the Middle East could further support Hong Kong equities by lowering energy costs and improving risk appetite among global investors. The city’s market has also benefited from renewed interest in Chinese technology shares and expectations of stronger investment into artificial intelligence infrastructure.
The rebound reflects how closely Asian financial markets remain tied to geopolitical developments and energy prices, particularly as investors search for signs of stability in an uncertain global economic environment.
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Emmanuel Abara Benson is a business journalist and editor covering artificial intelligence, global markets, and emerging technology.
He has previously worked with Business Insider Africa and Nairametrics, reporting on finance, startups, and innovation.
His work focuses on AI, digital economy, and global tech trends.
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