Hong Kong equities staged a remarkable V-shaped recovery during Monday's session. After an early pullback, major indices rebounded strongly in afternoon trading. The Hang Seng Index climbed 386.8 points (1.6%) to close at 24,590.12, while the Hang Seng TECH Index jumped 2.8% to 5,431.29. Turnover surged to HK$288.4 billion across the main board.

Galaxy Securities highlighted Hong Kong's compelling valuations within global equity markets, noting its absolute valuation remains relatively low despite hovering near historical median levels. CITIC Securities observed renewed valuation advantages emerging, anticipating northbound capital could regain momentum as insurers expand investment scopes under mounting allocation pressure.

Blue-chip stocks led the advance with Alibaba-W (09988) soaring 6.97% to HK$113.50, contributing 122.21 points to the index. Guosen Securities projected Alibaba's Q1 FY26 revenue would grow 2% year-over-year with 16% adjusted EBITA margin, though promotional investments might constrain Taotian Group's profit growth despite anticipated 6% GMV and 11% CMR increases. Cloud revenue is forecast to surge 22% amid stable margins and rising AI demand.

Other notable blue-chip performers included Sino Biopharmaceutical (01177), rising 4.94% to HK$6.37 and adding 4.9 index points, while CSPC Pharmaceutical (01093) leapt 7.51% to HK$8.59. Lagging constituents included Xinyi Glass (00868), sliding 4.43% to HK$8.20 and trimming 1.29 index points.

Sector-wise, technology giants powered ahead with Alibaba leading gains. Meituan, Kuaishou, and Baidu all climbed over 4%, while Tencent advanced more than 3%. AI concept stocks surged following NVIDIA's H20 chip export approval to China, with Kingsoft Cloud (03896) skyrocketing 16.81%. Innovator pharmaceutical shares extended their upward trajectory, while solar stocks retreated across the board.

Key sector movements:

1. **AI Stocks Rally**: Kingsoft Cloud (03896) surged 16.81% to HK$7.92; GDS Holdings (09698) jumped 12.19% to HK$38.65; Mainfoice (02556) gained 10.6% to HK$52.70. NVIDIA CEO Jensen Huang confirmed U.S. approval for H20 chip exports and announced upcoming RTXpro GPU launches. Guotai Junan Securities emphasized Hong Kong tech firms' competitive positioning to capture AI dividends, citing accelerating capital expenditure and cloud revenue growth.

2. **Biopharmaceuticals Extend Gains**: BeiGene (06160) rose 7.8% to HK$164.40; CSPC Pharmaceutical (01093) climbed 7.51%; InnoCare (09969) added 6.46%. Guojin Securities noted persistent strength in innovative drugmakers, driven by improving biotech financing and policy tailwinds. The broker recommended focusing on multi-specific antibody therapies addressing unmet clinical needs and pipeline-rich innovators.

3. **Solar Stocks Retreat**: Xinyi Solar (00968) fell 2.98% to HK$2.93; Flat Glass (06865) declined 2.9% to HK$10.04; Xinte Energy (01799) dropped 2.38% to HK$6.55. Industry earnings previews cited inventory pressures and price declines amid supply-demand imbalances. Multiple solar companies anticipate significant H1 losses exceeding RMB 2 billion. CITIC Futures cautioned that current anti-overcapacity measures may prove less effective than previous supply-side reforms.

Notable individual movers: - Yunfeng Financial (00376) skyrocketed 19.53% after announcing Web 3.0, RWA, and AI strategic initiatives. - MMG (01208) gained 4.99% following a H1 profit surge forecast of approximately 15.2x year-over-year to US$340 million. - China Merchants Securities (06099) rose 4.34% after its affiliate became Hong Kong's first state-backed virtual asset licensed broker. - Ganfeng Lithium (01772) fell 3.68% amid projections of H1 net losses between RMB 300-550 million.