Hong Kong stocks jump as Alibaba, tech peers drive market to five-week high while banks advance on Wealth Connect push

·3-min read

Hong Kong stocks climbed to a five-week high, fuelled by gains in Alibaba Group Holding and tech peers while financial stocks advanced on cross-border wealth management potentials.

The Hang Seng Index closed 1.5 per cent higher at 25,787.21 on Tuesday, a level not seen since September 13. The Shanghai Composite Index climbed 0.7 per cent to a three-week high of 3,593.15.

A 12 per cent rally in Bilibili and a 9.5 per cent gain in Kuaishou Technology helped propel the Hang Seng Tech Index to a 1.5 per cent gain. Alibaba, the owner of this newspaper, jumped 1.2 per cent on media reports it was launching a new server chip and planning a strategic investment in distressed chip maker Tsinghua Unigroup.

Do you have questions about the biggest topics and trends from around the world? Get the answers with SCMP Knowledge, our new platform of curated content with explainers, FAQs, analyses and infographics brought to you by our award-winning team.

Banks rallied as Hong Kong approved 19 lenders to offer wealth management products from Tuesday, following the official launch of the cross-border Connect scheme with Macau and mainland markets last month. China Merchants Bank rose 3.2 per cent while Citic added 1.4 per cent. AIA and Ping An Insurance rose by more than 2 per cent.

“Wealth Management Connect opens up unprecedented market opportunities for the financial industry in this area as consumer wealth continues to grow,” said Lawrence Lam, consumer business manager for Citigroup in Hong Kong. The US lender is teaming up with China Guangfa Bank to serve clients.

Xiaomi jumped 5.4 per cent after the smartphone maker’s founder Lei Jun said it will start mass production of electric cars in the first half of 2024, saying in a Weibo tweet that progress in the carmaking [project] has been faster than expected.

Stocks sustained gains even as reports this week showed China‘s economy slowed more than expected, with traders betting on some stimulus kick by year end to shore up growth. BlackRock last week said authorities can no longer ignore the slowdown without easing policies, while Standard Chartered called for a cut in reserve-requirement ratio.

Three tests for China stock investors as slowdown in GDP, earnings and trading divide analysts seeking signs of policy capitulation

“Somehow people are looking for policy-easing support due to the weak China GDP data,” said Mark Po, head of research at China Galaxy International Securities in Hong Kong. Investors are waiting for a breakthrough as markets remain divided on that front, he added.

Elsewhere, Geely Automobile rose 2.2 per cent with BYD adding 1.5 per cent, sustaining a rally after robust industry sales of electric cars in mainland China last month.

Guotai Junan Securities expects sustained growth of EV sales this quarter in China and globally. Better control of Covid-19 pandemic and improving supply of vehicle chips augur well for the coming peak consumption season, it added.

Four companies started trading on Tuesday. MicroTech Medical Hangzhou was unchanged at HK$30.50 in Hong Kong while Beijing Tongyizhong New Material Technology more than tripled to 16.33 yuan in Shanghai. In Shenzhen, Hunan Hualian China Industry rose 44 per cent to 13.49 yuan and Shaoyang Victor Hydraulics surged 170 per cent to 32.19 yuan.

Additional reporting by Enoch Yiu

More from South China Morning Post:

This article Hong Kong stocks jump as Alibaba, tech peers drive market to five-week high while banks advance on Wealth Connect push first appeared on South China Morning Post

For the latest news from the South China Morning Post download our mobile app. Copyright 2021.

Our goal is to create a safe and engaging place for users to connect over interests and passions. In order to improve our community experience, we are temporarily suspending article commenting