During the National Day holiday, A-shares were closed from October 1 to October 7 and resumed trading on October 8, while Hong Kong stocks were closed only on October 1 and traded normally on October 2, 5, 6, and 7.

Because the mainland market was shut, southbound Stock Connect trading was also suspended and resumed on October 8, so holiday trading in Hong Kong was mainly priced by foreign and local Hong Kong capital.

Wind data shows that as of the October 7 close, over the four trading days of the holiday the Hang Seng Index fell 1.96%, the Hang Seng Tech Index dropped 1.40%, and the Hang Seng China Enterprises Index declined 1.68%; the Hang Seng Stock Connect China AH Premium Index rose from 124.53 points before the holiday to 125.79 points.

Whether the holiday weakness in Hong Kong stocks will spill over into A-shares at the open has become a focal point for the market.

Hong Kong Trading Volume Declines Over Four Sessions

On October 2, the first trading day of the Hong Kong holiday, the market opened sharply lower, with the Hang Seng Index closing at 23,972.29 points, down 2.60%; on October 5 and 6 it rebounded for two consecutive sessions, gaining 0.28% and 1.00% respectively; on October 7 it weakened again, closing at 24,130.50 points, down 0.62%.

The absence of southbound capital was clearly reflected in turnover.

Wind data shows that on September 30, the last trading day before the holiday, total Hong Kong market turnover was HK$187.158 billion; turnover across the four holiday trading days generally declined, from HK$145.804 billion on October 2 to HK$98.102 billion on October 5, HK$98.265 billion on October 6, and further to HK$94.700 billion on October 7, a shrinkage of nearly 50% from the pre-holiday level on September 30, with the last three trading days all below HK$100 billion.

Divergence among sectors was pronounced.

In the AI hardware chain, Kingboard Laminates Holdings Ltd (SEHK: 01888) rose 10.42% over the holiday, while Lenovo Group Ltd (SEHK: 00992) gained 1.79%; Hua Hong Semiconductor Ltd (SEHK: 01347) rose 4.27% on October 5 before pulling back over the following two sessions, finishing the holiday down slightly by 0.09%.

Pharmaceutical stocks were volatile, with Viva Biotech Holdings (SEHK: 01873) and CanSino Biologics Inc (SEHK: 06185) rising 23.31% and 14.04% respectively on October 6, then falling 7.40% and 6.40% on October 7, though they still gained 10.46% and 3.99% over the holiday.

Leading mainland property developers weakened, with Longfor Group Holdings Ltd (SEHK: 00960) falling 7.46% over the holiday.

AH Premium Index Pushed Higher Passively

The Hang Seng Stock Connect China AH Premium Index reflects the premium of A-shares relative to H-shares; the higher the index, the more expensive A-shares are relative to H-shares.

As of October 7, the index stood at 125.79 points, up 1.26 points from 124.53 points on September 30 before the holiday.

During the long holiday, A-share prices did not move, so changes in the premium were mainly determined by the H-share side — H-shares fell overall during the holiday while A-share prices stayed at pre-holiday levels, passively pushing the premium index higher.

The same was true at the individual stock level.

Wind data shows that Zijin Mining Group Co Ltd (SEHK: 02899) H-shares rose 0.37% over the holiday to close at HK$32.36, China Molybdenum Co Ltd (SEHK: 03993) gained 1.19% to close at HK$15.32, and Semiconductor Manufacturing International Corp (SEHK: 00981) rose 0.41% to close at HK$60.90; A-share prices remained at pre-holiday levels over the same period, so for names whose H-shares rose, the AH premium narrowed accordingly.

On October 7, all three stocks pulled back, with SMIC down 1.06%, Zijin Mining down 0.68%, and China Molybdenum down 0.65%.

Table: Key Hong Kong stocks and AH premium index data during the 2026 National Day holiday. Data source: Wind. Chart by Wang Xue'er.

Can the Post-Holiday Structural A-Share Rally Continue?

From a historical pattern perspective, Wind data shows that from 2016 to 2025, on the first trading day after the National Day holiday, the Shanghai Composite Index rose in 7 years and fell in 3 years, a 70% probability of gains, with an average increase of 0.49%.

On the domestic fundamentals side, data released on September 30 by the Service Industry Survey Center of the National Bureau of Statistics and the China Federation of Logistics & Purchasing showed that in September China's manufacturing Purchasing Managers' Index (PMI) was 50.1%, up 0.3 percentage points from the previous month and moving into expansion territory; the People's Bank of China will conduct a 120 billion yuan outright reverse repo operation on October 8 using a fixed quantity, rate tender, multiple-price allotment method, with a term of 3 months (89 days) and a maturity date of January 5, 2027 (postponed in case of holidays).

Li Daxiao, former chief economist at a brokerage, told Securities Daily that with southbound capital absent during the holiday, Hong Kong trading volume shrank markedly, making effective pricing difficult.

Hong Kong weakness affects A-shares but is not decisive and is more weakly correlated; a structural A-share rally may still continue.

Looking at third-quarter reports, high-dividend names, bank dividend plays, and central state-owned enterprises are more favored by defensive capital.

Fu Yifu, a special researcher at Sushang Bank, told Securities Daily that historical experience shows that after Hong Kong stocks experience an overshoot during a holiday liquidity vacuum, the return of southbound capital after the holiday often provides support, and A-shares do not necessarily fall to catch up on the first day after the holiday.

He further said that catch-up downside pressure needs to be distinguished by sector: heavyweight sectors such as financials and real estate have stronger AH linkage, and related A-share sectors face some correction pressure at the open; pricing in technology growth sectors is more driven by industry logic and earnings, and AH price spreads may not narrow through A-share declines but could also be completed through Hong Kong rebounds.

On whether the Hong Kong pharma and AI hardware moves can map to A-shares, Fu Yifu said the key is whether the industry logic can be verified, whether earnings visibility is sufficient, and whether capital is willing to take the other side.

In AI hardware, optical modules, storage, PCB, semiconductor equipment, and overseas computing power capex are highly correlated; A-share leaders are embedded in global supply chains, with relatively higher order visibility and earnings elasticity; in pharma, continuity depends on orders and commercialization delivery.

Within the third-quarter report window, the segments with higher earnings certainty are mainly concentrated in the AI computing power chain, as well as CDMO, upstream scientific research, and innovative drug overseas expansion in pharma.