Northbound Capital Net Sold HK$6.554 Billion, Tracker Fund of Hong Kong Dumped Over HK$2.1 Billion
nashnova research
Southbound capital net sold HK$6.55 billion on September 28, with the Tracker Fund and Hang Seng China Enterprises ETF shedding a combined HK$3.3 billion; the Fed's hawkish stance broke the 'buy-the-last-bad-news' thesis, leaving Q4 inflow prospects uncertain.
What did northbound money sell, and how much?
Shanghai-link southbound net sold HK$1.738 billion; Shenzhen-link net sold HK$4.816 billion — a combined HK$6.554 billion for the day.
Tracker Fund (02800) saw net selling of HK$2.117 billion; Hang Seng China Enterprises ETF (02828) saw HK$1.277 billion — the two broad-market ETFs alone accounted for over HK$3.3 billion, roughly half the day's total outflow.
This means → Southbound capital was not cherry-picking stocks to trim — it was systematically cutting Hong Kong exposure, starting with the most liquid ETFs.
Why the concentrated selling now?
Galaxy Securities noted the Fed's September meeting struck a tone more hawkish than the market expected: the dot plot signaled at least one more rate hike this year, and Chair Waller named inflation the top concern.
In plain terms = The market had bet on a "worst is over, time to bounce" playbook — the Fed's message was "rates stay higher for longer," and that bet collapsed.
Galaxy sees no near-term catalyst for a sustained Hong Kong rally; uncertainty has been pushed into Q4.
Which individual stocks were hit hardest?
Tencent (00700) net sold HK$976 million; SMIC (00981) net sold HK$600 million; Alibaba-W (09988) net sold HK$137 million — three heavyweight names shed a combined HK$1.7 billion.
YOFC (06869) net sold HK$477 million; Shandong Gold (01787) net sold HK$230 million, spanning telecom infrastructure and gold.
This means → The selling was not sector-specific — it reflected a broad risk-appetite downgrade across sectors.
Who was bought against the tide?
Kingboard Laminates (01888) fell sharply on the day, yet northbound funds bought the dip with net inflows of HK$434 million; Kingboard Holdings (00148) drew HK$14.58 million.
Morgan Stanley projects the global copper-clad laminate — a core raw material for PCBs — market will grow from US$19 billion in 2025 to US$47 billion by 2030, a 20% CAGR well above the consensus range of US$35–40 billion.
JPMorgan forecasts Kingboard Laminates' EPS will grow 8× from 2025 to 2028, driven by laminate price increases, capacity expansion, and a 75% scale-up in loom equipment.
In plain terms = The broad market was falling and northbound money was leaving, but two bulge-bracket growth calls turned Kingboard into a "buy the dip" opportunity.
Why did CNOOC and MiniMax also attract inflows?
CNOOC (00883) drew net buying of HK$426 million. On September 27, President Trump said he expected US-Iran talks to resume within a week, while adding he was "still considering" military strikes on Iran; Iran's foreign minister Araghchi said Tehran was prepared to resume hostilities but had not abandoned diplomacy.
This means → The "talk and fight" two-way geopolitical tension supports oil-price expectations, channeling funds into energy names.
MINIMAX-W (00100) drew HK$55.05 million. An anonymous large language model called Space Bunny launched on OpenRouter and OpenCode on September 23; by September 27 it ranked first in token call volume on both platforms for three consecutive days — users speculated it is a new MiniMax model.
What does Q4 look like for Hong Kong fund flows?
Large-scale northbound ETF selling + a persistently hawkish Fed — the two pressures are stacking.
This reflects a shift in southbound capital's pricing logic: from "valuation repair" to "waiting for a clear catalyst."
In plain terms = The money is not unwilling to come back — it is waiting for a signal. Whether Hong Kong equities can attract sustained trend-driven inflows in Q4 is the key test ahead.
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