Hang Seng Tech Index has plummeted 27 percent from its October 2025 peak, now trading near pre-DeepSeek levels. This sharp correction may signal an investment opportunity as capital rotates from crowded AI hardware trades into overlooked internet giants. The HST significantly underperformed regional peers year-to-date, down 11 percent while ChiNext and STAR50 posted double-digit gains. Analysts at CGSI and UBS suggest the index is well-positioned for a tactical rebound, with approximately 52 percent exposure to internet platforms and AI application companies. Valuations have widened to historically attractive levels compared to A-shares and US technology stocks. External tailwinds from strong US software performance and potential new AI developments could provide additional support for the index recovery.
