The Hang Seng dropped 310 points, or 1.2%, to finish at 26,149 on Thursday, sustaining losses from the prior session as most sectors declined. Sentiment was hit by a steep drop in U.S. futures and strong selloffs in U.S.-listed, China-focused funds Wednesday. Caution also grew before China’s December CPI and PPI data Friday, with deflation risks still in play. Financials dipped 1.5%, mirroring weakness in mainland peers as investors booked profits following a recent rebound. Hong Kong’s tech index fell around 1.0% despite reports that Beijing had asked domestic firms to halt orders for Nvidia’s H200 chips and was expected to mandate local AI chip purchases. In contrast, property stocks rose 1% after China's central bank signaled its readiness to lower borrowing costs this year and roll out counter-cyclical measures to support the economy. Major laggards included Sands China (-4.1%), China Reinsurance (-3.9%), Meituan (-3.6%), Kuaishou Tech (-3.0%), and Techtronic Industries (-1.7%).