- The Hang Seng Index jumped 488 points to close the midday session at 25,276, driven by a sharp 2.5% overnight rally in the Dow Jones and hopes of a de-escalation in US-Iran hostilities.
- Zhipu AI (02513.HK) surged 31.9% after reports projected its annual recurring revenue to hit RMB 1.7 billion by March 2026, a massive 60-fold year-on-year increase.
- Pharmaceutical and biotech sectors led the broader market rally, with leaders like 3SBio and Junshi Biosciences posting gains between 10% and 14%.
The Hang Seng Index (HSI) kicked off the new quarter with a powerful relief rally on Wednesday, surging 569 points at the open before settling into a robust 488-point (2%) gain by the midday break. This massive pivot follows a grueling March, the index’s worst monthly stretch in two years, and was fueled by a sudden wave of global optimism as signals emerged that the Middle East conflict may be nearing a de-escalation point.
Global relief rally triggers HSI rebound
The primary catalyst was a sharp shift in geopolitical sentiment. Following remarks from Washington suggesting an “off-ramp” for hostilities in Iran within weeks, global markets snapped out of “fear mode.”
The enthusiasm was infectious: after a 3.8% surge in the Nasdaq overnight, regional markets followed suit, with Japan’s Nikkei climbing 4% and South Korea’s Kospi soaring over 6%. For Hong Kong, which has acted as the primary barometer for regional risk, this marked one of the strongest opening sessions of 2026.
Zhipu AI soars 32% on explosive revenue guidance
While the macro narrative provided the tailwind, the technology sector provided the firepower. Zhipu AI (02513.HK) stole the midday spotlight, skyrocketing 31.9% after CICC projected its annual recurring revenue (ARR) to reach RMB 1.7 billion this month, a staggering 60-fold year-on-year increase. This “AI fever” spilled over into the broader tech ecosystem:
- Tencent and Alibaba climbed between 2.6% and 3.3%.
- Bilibili surged 5.2%, while Meituan bucked the trend with a 2.4% dip.
- Semiconductor leaders like SMIC and Hua Hong gained up to 5% as supply chain anxiety eased.
Biotech and pharma oin the Rally
The buying spree extended deep into the healthcare sector, which has been beaten down by high input costs and risk aversion throughout March. Innovative drugmakers saw double-digit gains, with 3SBio and Junshi Biosciences rallying between 10% and 14%.
The recovery in WuXi AppTec (+8.1%) suggests that investors are finally moving back into growth-focused cyclicals as the “War Premium” on energy begins to soften.
Inflation vs growth outlook: Can the market rally sustain into Q2?
Despite the euphoria, market veterans remain cautious. While China’s manufacturing PMI beat expectations at 50.4, the focus is shifting from inflation fears to growth stability. As Marcin Frąckiewicz noted, Hong Kong’s route forward remains tight; while today’s session is a clear win for the bulls, the durability of this rally depends entirely on whether oil prices continue to retreat and the “Trump Peace” narrative holds firm through the second quarter.
| Index / sector | Midday level | Change |
| Hang Seng Index (HSI) | 25,276 | +2.0% |
| Hang Seng Tech Index | 4,723 | +1.6% |
| Zhipu AI (02513.HK) | HKD 760 | +31.9% |
| Biotech Sector | N/A | +9.5% (Avg) |
The rally was sparked by a de-escalation in Middle East tensions and a strong overnight performance on Wall Street. Signals that the U.S.-Iran conflict could end within weeks triggered a massive “risk-on” move across Asian markets.
Zhipu AI surged 32% following a CICC report projecting a 60-fold increase in its annual recurring revenue. Investors ignored current net losses to focus on the company’s massive growth in AI API demand.
While today’s gain is significant, the HSI just closed its worst month since January 2024. Analysts warn that for the rally to be sustainable, oil prices must remain stable and global growth concerns must be addressed.