Hong Kong tech stocks including Alibaba gained on Wednesday as Jack Ma’s Ant Group filed for dual listings in the city and in Shanghai.
The three stocks that will become part of the Hang Seng Index on September 7 all closed with gains. Wuxi Biologics shot up 5.9 per cent, while e-commerce giant Alibaba, Ant’s largest shareholder and the owner of the South China Morning Post, jumped 4.2 per cent and Chinese smartphone maker Xiaomi soared 5.7 per cent. Xiaomi, which reports earnings Wednesday after market close, posted an 18.4 per cent gain last week.
The month-old tech board of Hong Kong’s 30 largest technology companies rose 0.7 per cent.
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A number of other tech stocks did well on excitement about Ant Group’s mega listing, which is expected to surpass Saudi Aramco’s US$29.4 billion initial public offering (IPO) in December as the world’s largest fundraising ever. Online games giant NetEase advanced 4.2 per cent. E-commerce titan JD.com shot up 6 per cent, sending its relative strength index to 82, with a level of 70 warning a stock may be overbought.
“After Ant released their prospectus yesterday, all the market focus was on their listing, boosting up the whole sector valuation, leaving more room for Ant to rise after listing,” said Alan Li, portfolio manager at Ample Capital.
The Hang Seng Index see-sawed between small gains and losses, and finished with a teensy gain at 25,491.79. The benchmark was trying again to close above 25,500, which it did on Monday for the first time in about five weeks. The resistance level has been stubborn.
Health care stocks led gains while information technology stocks were laggards. AAC Technologies fell 2.4 per cent in its fourth straight session of losses, while Sunny Optical declined 2.4 per cent. Both AAC and Sunny Optical have suffered since US President Donald Trump tightened the screws on Huawei’s supply chain.
In the mainland, the Shanghai Composite Index fell by 1.3 per cent to 3,329.74. The tech-heavy ChiNext fell 2.1 per cent while the CSI 300 of large caps in Shanghai and Shenzhen slid 1.2 per cent.
Continuing this week’s trend of spectacular gains of debuting stocks on the mainland, chemical manufacturer Jenkem Technology shot up 232 per cent in its debut on the Star Market, where there are no limits on trading for the first week of new stocks.
Elsewhere in Asia, Japan’s Nikkei 225 was little changed, while South Korea’s Kospi rose 0.1 per cent and Australia’s S&P/ASX 200 fell 0.7 per cent.
“This week’s ‘risk-on’ move is a little less convincing ... as coronavirus concerns never drift far from the market conversations these days,” Stephen Innes, global chief market strategist at AxiCorp, wrote in a note.
More from South China Morning Post:
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