Hang Seng Index poised to add AI developers in quarterly rebalancing

The Hang Seng Index is poised to expand its technology representation when the index compiler releases its latest quarterly review results on Friday. Artificial intelligence developers MiniMax Group and Z.ai, known as Zhipu in China, are the leading candidates for inclusion in the 93-member benchmark.

Investment banks, including China International Capital Corporation, identify these AI model developers as the most probable additions. Zijin Gold International, a unit controlled by bullion producer Zijin Mining Group, is also considered a front runner for a spot in the index.

This potential rebalancing addresses the current sector composition of the Hang Seng Index. As of July, the information technology sector ranked third by weighting at 15.6 per cent, trailing financials at 34 per cent and consumer discretionary at 22 per cent.

Increasing the presence of high-growth AI companies could help the benchmark better reflect the evolving landscape of China’s technology sector. The broader tech gauge has struggled recently, declining 14 per cent this year, even as the main Hang Seng Index has remained stable.

Tech Index Methodology Overhaul

Beyond the main benchmark, the index compiler is also overhauling the Hang Seng Tech Index. A consultation paper released this month proposed expanding the number of constituents from 30 to 50.

Under the proposed methodology revamp, companies demonstrating the fastest revenue growth would become eligible for inclusion. This adjustment aims to capture dynamic market performers more effectively within the dedicated technology gauge.

For investors and market professionals, these changes signal a deliberate shift toward growth-oriented technology stocks within Hong Kong’s primary indices. The inclusion of prominent AI developers would provide institutional funds tracking the benchmark with direct exposure to China’s expanding artificial intelligence market.