The Hang Seng China Enterprises Index, which tracks major Chinese stocks listed in Hong Kong, dropped as much as 2.3% on June 22, pushing it to nearly 20% below its October 2, 2025 peak. That’s the textbook definition of a bear market, and the index is now teetering right on the edge of one.
What’s driving the selloff
May retail sales in China contracted for the first time since the pandemic. Domestic travel during the Dragon Boat Festival holiday came in flat year-over-year.
Alibaba Group and Tencent Holdings, two of the heaviest weights in the HSCEI, were among the largest contributors to the index’s decline.
A tale of two indexes
