Hong Kong stocks closed up, pushing the benchmark to a three-year high and erasing all the losses spurred by US President Donald Trump’s new tariffs, as expectations rose that China will introduce more stimulus polices to achieve its newly set annual growth target.

The Hang Seng Index increased 3.3%, the Hang Seng Technology Index surged 5.4%.

Alibaba Group Holding surged 8.4% after releasing a reasoning artificial intelligence (AI) model that it claims can compete with that of DeepSeek.

Kuaishou rose 16%; Mixue rose 15%; JD.com rose 8.4%; Tencent rose 7.6%; Meituan, XPeng up 5%; BYD rose 3.6%; Nio rose 3%.

China’s growth target of around 5 per cent for the year has raised optimism that more forceful stimulus measures will be necessary given multiple headwinds including deflation, the property market’s woes and frayed ties with the US. The government work report unveiled during the ongoing National People’s Congress (NPC) also highlighted looser monetary policies, indicating that cuts in borrowing costs and banks’ reserve requirement ratio are on the way. It also pledged to widely apply AI large-language models and vigorously develop smart equipment and terminals including robotics and electrical vehicles.

“The pro-growth business tone of the government work report would provide fundamental support to investor sentiment after a strong market rally,” said Patrick Pan, a strategist at Daiwa Securities Group. He cautioned that there would be technical resistance after the Hang Seng Index topped the 24,000-point mark, based on demanding valuations and trade-war risk.

The uptrend on Chinese stocks remained intact, as messages from the NPC about tech innovation and consumption should sustain momentum, said Laura Wang, a strategist at Morgan Stanley in Hong Kong. The recent tariff increase would only disrupt, not derail the run-up, because of the falling US share of China’s exports and investors’ over-pessimism, she said.

Investors will keep a close watch on a joint media briefing by the nation’s top economic officials on Thursday afternoon for clues on fresh supportive measures. The press conference will include the chiefs of the finance ministry, the central bank and the securities regulator.

The frenzy on Chinese technology stocks has galvanised refinancing activities in Hong Kong. Around 17 tech companies have raised a combined HK$52 billion (US$6.7 billion) from share placements or additional offerings since February, a sevenfold increase from January, according to Bloomberg data.