Hong Kong shares set to end week at 3-year high

Hong Kong stocks rose on Friday, on track to end the week at their highest level in three years, as investors' enthusiasm towards artificial intelligence continued to fuel the market. Despite the disappointing trade data, the impact on Chinese stocks has been limited so far. ** Onshore property shares were down 1.9%，while materials and metals rose 1.6% and 2.1%, respectively.

Hong Kong stocks rose on Friday, on track to end the week at their highest level in three years, as investors' enthusiasm towards artificial intelligence continued to fuel the market. China stocks were roughly flat for the week. ** Hong Kong benchmark Hang Seng was up 0.6% by the lunch break, hitting the highest level since February 2022. China's blue-chip CSI300 Index edged down 0.1% and the Shanghai Composite Index was flat.

** Tech majors in Hong Kong rose 1.3% to the highest level since late 2021. ** For the week, the Hang Seng Index was set to gain 6.8% and the CSI300 Index was down 0.1%

** Both the Hang Seng Tech Index and the onshore AI shares have risen 20% and 18%, respectively, since February when Deepseek became a buzz word among market participants. ** "China's stock market is on the rise, driven by new narratives in fundamentals and artificial intelligence, attracting more foreign investors," said Lei Meng, China strategist at UBS in a media briefing on Friday.

** "We observe that various types of investors, both active and passive, are gradually increasing their allocations to Chinese equities from underweight positions," Meng said. ** Meng also noted trade tensions may cause short-term market fluctuations such as one-day reaction, but they are unlikely to have a significant long-term impact on the onshore stock market.

** China warned on Friday it will "resolutely counter" pressure from the United States on the fentanyl issue, after Washington levied an additional 10% tariffs on Chinese imports this week. ** China's exports in the January-February period increased just 2.3% year-on-year by value, while imports unexpectedly contracted 8.4%, customs data showed on Friday. Despite the disappointing trade data, the impact on Chinese stocks has been limited so far.

** Onshore property shares were down 1.9%，while materials and metals rose 1.6% and 2.1%, respectively.