Hong Kong investors remain positive on the market outlook, with nearly 90 percent planning to maintain or increase their investments despite global economic uncertainties and geopolitical tensions, according to a survey released by Dah Sing Bank on Monday.

The bank’s investor confidence index stood at 68, unchanged from last year. The survey found that investors were keeping an active stance, with 88 percent of respondents saying they plan to raise or maintain their investment capital over the next 12 months. Those confident about market conditions expected an average investment return of 7.7 percent.

Across asset classes, about nine in 10 investors anticipated positive or flat performance over the coming year. Equities remained the most favored asset class, with 56 percent of respondents forecasting stocks to deliver positive returns.

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For specific benchmarks, surveyed investors expected the Hang Seng Index and the S&P 500 Index to rise 15 percent and 17 percent respectively over the next 12 months, using their levels of 25,207 and 7,412 points in late July as baseline figures.

Hong Kong stocks have been influenced in the near term by the outlook for interest rates, corporate earnings and volatility in artificial intelligence-related shares, said Florence Cheung, general manager and deputy head of wealth management at Dah Sing Bank.

She added that if AI technologies make breakthroughs and technology companies improve their ability to monetize them, the Hang Seng Index could test 27,000 points, while stronger support may be seen around 22,000 points.

“This year’s survey shows that while seeking returns, investors are also placing greater emphasis on risk management and asset allocation,” said Cheung. “As the investment environment continues to evolve, demand for diversified investment solutions and risk management tools is rising.”

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Despite concerns over the past year including geopolitical tensions, interest-rate trends and a slowing global economy, the data showed overall investor sentiment remained positive, said Simon Chung, research director at market research firm Acorn.

The survey was conducted in August and covered 608 local investors, including mass-market investors with liquid assets of less than HK$1 million ($130,000), affluent investors with HK$1 million to HK$8 million, and high-net-worth investors with more than HK$8 million. A reading of 50 on the index represents the neutral point, while a reading above 50 indicates confidence.

Confidence was stronger among wealthier segments, with the index for high-net-worth investors reaching 75.

Nearly half of respondents held less than 40 percent of their liquid assets in cash. Investors with higher confidence levels tended to hold less cash and use more diversified asset allocations, which the bank said showed diversification remained an important investment strategy.

Technology was the most closely watched investment theme for a second consecutive year, cited by nearly 60 percent of respondents. However, about half of investors said they were concerned about stretched valuations in AI-related assets.

Contact the writer at irisli@chinadailyhk.com