Hong Kong MPF Soared 1.4% On Average For January 2025

European stocks have been a soaring path, with gains surpassing those of U.S. stocks and other major global markets. German’s DAX, France’s CAC 40, Spain’s IBEX 35 and UK’s FTSE 100 rallied by 9.2%, 7.7%, 6.7% and 6.1%, respectively for January. In Asia, Korea market is showing signs of rebounding, aided by low valuation in the second half of last year and fueling the optimism of overall robust fundamentals. Korea’s KOSPI index rallied 4.9% and became the top performing market among all Asia markets for January. US stock markets continued its bull path, Dow Jones Industrial index soared 4.7% and S&P 500 and Nasdaq Composite index also rose 2.7% and 1.6%.

Asset Types Analysis

The total 376 Hong Kong Mandatory Provident Fund (MPF) registered for sale in Hong Kong posted positive return of 1.4% on average in January of 2025(as of 2025/01/31)

Hong Kong MPF Performance by LGC Analysis

There are overall 376 Hong Kong Mandatory Provident Fund (MPF) registered for sale in Hong Kong market with a total 24 Lipper Global Classifications. Among all 24 classifications, Equity Korea posted 7.9% on average and took the leading positions among all MPF classifications while Equity Sector Healthcare, Equity Europe, Equity US and Equity Global posted positive return of 5.8%, 5.4%, 3.4% and 2.6%, respectively in January.

Outlook

A second Donald Trump US presidency could heighten trade uncertainties for Hong Kong, impacting its economic stability. US President Donald Trump’s new trade war is further blurring the lines between Hong Kong and Beijing. Hong Kong’s economic recovery is likely to be hindered by Trump’s threat to slap 10 per cent tariffs on Chinese goods, could spell bad news for Hong Kong’s biggest exports to the country, telecoms and technology equipment.

Economists generally expect Trump’s tariffs on Hong Kong products to do little damage to the economy as they apply to goods manufactured in the city, rather than so-called re-exports that make up the bulk of its trade. Domestic exports are mostly jewelry, gold and metals which accounted for just 1.3% of total shipments last year, with only a fraction going to the US. The city’s re-exports of Chinese goods to the US made up 3.3% of total exports last year.

In 2020, Trump signed an executive order to remove the city’s special trade status and require Hong Kong-produced goods to be labeled “made in China”, claiming that the city’s “autonomy is undermined” by the then newly promulgated National Security Law for Hong Kong. Since 2020, Beijing has stepped up its support for the Hong Kong Special Administrative Region through initiatives such as the Guangdong-Hong Kong-Macao Greater Bay Area plan, which has increasingly integrated the city into China’s national economic strategy. Hong Kong is still playing an important role for it provides easier access to the Chinese mainland market for western enterprises and institutions.

Hong Kong’s real GDP growth slowed to 1.8% year-on-year (YoY) in the third quarter, down from 3.2% in the previous quarter, primarily due to weaker net export growth, which had previously buoyed its economy. Personal consumption growth remained weak, influenced by continued northbound travel and spending.