China's Indexes Extended Weekly Gains, BYD and Xiaomi June Deliveries Exceeded Expectations

Li Chen
03 Jul, 2026
Hong Kong

China's indexes advanced on Friday and extended weekly gains, but technology stocks remained a key drag on the sentiment. 

The Hang Seng Index jumped 1.6%, and the mainland-focused CSI 300 Index increased more than 1% amid growing debate about valuations of the AI-related stocks. 

Investors are increasingly questioning the elevated level of investment in AI infrastructure amid worries that returns on investment are likely to be far lower than expected and lag behind in time too. 

Despite the growing use of artificial intelligence and the long-term growth potential of the technology, investors are worried that valuations may have outpaced fundamentals amid intensifying competition and escalating hardware and training costs for models.

On the economic front, service industry growth edged slightly lower in June, according to a private survey released by S&P Global. 

The RatingDog China General Services PMI eased to 54.1 in June from 54.4 in May, supported by domestic demand. 

Business sentiment remained positive for the third month in a row and matched the level in the previous month. 

 

China Indexes and Stocks 

The Hang Seng Index jumped 1.6% to 23,416.78, and the mainland-focused CSI 300 Index increased 1.1% to 4,867.59. 

For the week, the Hang Seng Index gained 2.2% and the CSI Index edged up a fraction. 

BYD gained 6% to HK $82.80, and the stock rebounded from a two-year low after vehicle sales in June surpassed expectations. 

Unit sales increased annually by 5.5% to 403,472, marking the second consecutive month of growth. 

Overseas demand drove the increase in monthly performance, and the company sold a record 175,349 vehicles, an increase of 94.7% from a year ago, accounting for 43.4% of total electric vehicle sales in the month. 

However, domestic demand remained under pressure, and unit sales decreased 22% to 228,123 vehicles. 

Xiaomi Corp. rose 1.5% to HK $22.94, and the company's automotive unit reported a sharp rise in unit sales in June. 

Sales rose to above 30,000 units and extended second-quarter deliveries to 80,856 units in the quarter ending in June. 

The company has an aggressive new product launch schedule, and the vehicle maker has targeted annual unit sales of 550,000, an increase of 34% from 410,000 units in 2025.