Hang Seng Index forecast after hitting a brick wall at H$27,165

The Hang Seng Index pulled back on Monday, reaching a low of H$26,628, down from this year’s high of H$27,165, after China published the latest GDP data and other macro data. It remains much higher than last year’s low of H$19,220.

China’s GDP growth rate hits target, but slows in Q4

The Hang Seng Index and other Chinese indices remained on edge on Monday as investors digested the latest macro data, which showed that the economic growth hit the 5% target in 2025, even as it faced the challenge of the United States tariffs. This growth was higher than what many analysts, including World Bank, predicted.

Data published by the National Statistics Bureau (NBS) showed that the House Price Index (HPI) retreated by 2.7% in December after slowing by 2.4% in the previous month.. China’s housing sector has never recovered since the collapse of top companies like Evergrande.

More data showed that the retail sales growth eased to 0.9% in December from 1.3% in November, while industrial production rose by 5.2% during the month.

As a result, the economy expanded by 4.5%  in the fourth quarter, a big deceleration from the previous 4.8%.  This deceleration was mostly because of a drop in fixed asset investments as Beijing moved to clear hidden debt and reduce excess competition.

Another red flag for the country was that deflation continued for 11 quarters, while birth rates plunged to the lowest level in years.

Still, the country managed to hit its 5% annual target last year, and Beijing expects that the growth will accelerate later this year.

China’s growth was mostly driven by trade, which accelerated as more foreigners bought its products. While exports to the United States dropped in 2025, trends to other regions like Africa and South America surged during the year. Its trade surplus jumped to $1.2 trillion during the year.

Top gainers and laggards in the HSI Index 

The Hang Seng Index retreated after the latest Chinese data as concerns about geopolitics remained following Donald Trump’s decision to slap tariffs on some key NATO allies.

Most companies in the Hang Seng were in the red on Monday, with Wuxi Biologics falling by 5%. Innovent Biologics, Hansoh Pharmaceutical, Sino Biopharmaceutical, and WuXi AppTec were the top laggards as they plunged by over 4% on Monday.

The other top laggards in the Hang Seng Index were companies like Zhongsheng Group, New Oriental Education, Alibaba Group, Kuaishou Technology, and China Resources Land, which fell by over 2.6%.

On the other hand, Li Ning, China Mengniu Dairy, Baidu, and China Hongkiao were the best gainers.

Hang Seng Index technical analysis 

The daily timeframe chart shows that the Hang Seng Index has hit a brick wall at H$27,165, its highest level in October and November last year, and in January this year. It has struggled to move above that level, a sign that bulls are hesitant to place bids.

The index has remained above the 50-day and 100-day Exponential Moving Averages (EMA). Therefore, the most likely Hang Seng Index forecast is neutral for now. 

More upside will be confirmed if it moves above the key resistance level at H$27,164. A move above that level will point to more gains, potentially to the strong pivot, reverse level of the Murrey Math Lines tool at H$27,343.

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