Hong Kong’s Hang Seng Tech Index welcomes MiniMax, Zhipu in AI milestone amid slump
Analysts say substantial passive inflows may follow the inclusion of MiniMax and Zhipu, though looming lock-up expiries risk diluting gains
The downturn spread across regional markets, dragging key indices lower. Hong Kong’s Hang Seng Index fell 1.2 per cent and the Hang Seng Tech Index lost 2.7 per cent, while South Korea’s Kospi plunged 8.3 per cent and Taiwan’s Taiex dropped 3.5 per cent.
Analysts said the inclusion could broaden liquidity as index-tracking funds adjust portfolios. Morgan Stanley estimated in an April report that the two companies could eventually account for 5 to 7 per cent of the benchmark, implying US$1.25 billion to US$1.75 billion of passive inflows. Their initial weightings are 0.53 per cent for Zhipu and 0.36 per cent for MiniMax.
Morgan Stanley further projected that had MiniMax and Zhipu been included in the Hang Seng Tech Index at the time of their initial public offerings (IPOs), replacing the benchmark’s two smallest constituents, the index’s year-to-date return would have been about 5 percentage points higher.
“The inclusion will broaden liquidity as index funds will be forced to buy,” said Hong Hao, managing partner and chief investment officer at Lotus Asset Management. He added that Zhipu’s larger market capitalisation could result in a higher index weighting and relatively stronger performance than peers.