Hang Seng Index Falls 0.5%; BYD Leads Decline

Hang Seng Index Falls 0.5%; BYD Leads Decline

The Hang Seng Index (HSI) closed 0.5% lower on Monday, September 12, 2025, following a mixed performance in Asian markets. The index, which includes major Hong Kong-listed companies, fell to 17,990.53 points after opening at 18,300.00 points. The decline was led by a 6.6% drop in BYD Company Limited (BYD), which is one of the largest electric vehicle manufacturers in the world.

The sell-off in BYD came despite the company's strong performance in the past few months. BYD's shares have been buoyed by the global trend towards electric vehicles and the company's innovative technologies. However, the recent decline in the stock price suggests that investors are becoming more cautious about the potential challenges in the electric vehicle market, such as supply chain disruptions and regulatory uncertainties.

The overall market sentiment in Hong Kong was mixed, with some sectors performing well while others experienced significant declines. For instance, technology stocks, which have been a significant driver of the market's performance, saw a mixed response. While the Hang Seng Tech Index hit a four-year high, it remains 40.93% below its peak in February 2021 . The index's performance was driven by growth stocks benefiting from positive sentiment following the National Development and Reform Commission's (NDRC) announcement of 500 billion Renminbi (RMB) in support for the artificial intelligence (AI) initiative .

On the other hand, the Hang Seng Index was pulled down by sectors such as real estate and the restaurant and catering sectors, which have been struggling due to economic slowdown and policy changes. The September Manufacturing Purchasing Managers' Index (PMI) registered 49.8, indicating a contraction in manufacturing activity .

The decline in the Hang Seng Index also comes amid concerns about the economic outlook in China. The country's economic data has shown signs of slowing down, with the official Manufacturing PMI at 49.8 and the official Non-manufacturing PMI at 50. The Composite PMI, which includes both manufacturing and non-manufacturing sectors, edged up to 50.6 from 50.5 . The mediocre economic data has raised the odds of further policy support for the economy.

Despite the decline in the Hang Seng Index, some investors remain optimistic about the long-term prospects of the market. They point to the strong fundamentals of many companies listed on the index and the potential for further policy support from the government. However, the recent decline in BYD and other sectors suggests that investors are becoming more cautious about the risks in the market.

In conclusion, the Hang Seng Index's decline on Monday was driven by a mix of factors, including the performance of individual stocks, sector-specific trends, and broader economic concerns. The index's performance in the coming weeks will depend on how these factors evolve and how investors respond to them.