Hong Kong’s stock market declined on Friday, giving back part of its weekly gains as investors reacted to renewed turbulence on Wall Street and mounting concerns about the disruptive potential of artificial intelligence across global markets.

The Hang Seng Index fell by around 1.1 per cent in early trading as technology and internet heavyweights registered broad-based losses.

Key tech names including Baidu, Alibaba Group and Tencent Holdings all slipped, reflecting the risk-off sentiment that has gathered pace since U.S. equities experienced a sharp sell-off linked to worries about AI’s wider impact on traditional business models.

The Hang Seng Tech Index also moved lower amid the broader retreat.

Investors in Hong Kong have been closely tracking developments in the U.S. after major American stock indexes, including the S&P 500 and Nasdaq Composite, posted notable declines as concerns over AI valuation and earnings prospects rippled through technology sectors.

The sell-off in the U.S. has been seen as a catalyst for tightening risk appetite globally, prompting portfolio adjustments in Asian markets.

Market participants said the renewed focus on the sustainability of AI-driven gains, coupled with broader macroeconomic uncertainty, has fed into a reassessment of valuations for high-growth technology stocks.

Mainland Chinese and international investors alike have taken a more cautious stance, divesting from some positions while monitoring broader market sentiment.

The pullback in Hong Kong’s equities came even as some sectors had shown resilience earlier in the week, highlighting the fragility of gains in a market increasingly sensitive to global capital flows and jittery investor psychology.

With economic data and corporate earnings still in focus, analysts say volatility may persist as markets weigh the implications of technological disruption and shifting investor expectations.