Tencent, Alibaba, AIA fuel Hong Kong market rally while BeiGene erases loss amid Silicon Valley Bank fallout

Chinese tech stocks outlook brightens on consensus earnings upgrade, favoured by Goldman Sachs; Xpeng and Weibo gain on index inclusion event

BeiGene had 3.9 per cent or about US$175 million, of cash frozen in failed lender Silicon Valley Bank; more than 10 others have some minimal deposits

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Chinese biotech firm BeiGene has 3.9 per cent of its cash frozen in the collapse of Silicon Valley Bank. Photo: Xiaomei Chen

Published: 10:18am, 13 Mar 2023Updated: 5:39pm, 13 Mar 2023

Hong Kong stocks advanced amid a bullish view on earnings among Chinese tech leaders, overshadowing concerns about a wider fallout among Chinese biotech companies including BeiGene from the collapse of Silicon Valley Bank. HSBC gained after buying the UK unit of the US bank.

The Hang Seng Index rose 2 per cent to 19,695.97 at the close of Monday trading, while the Tech Index surged 2.9 per cent and the Shanghai Composite Index added 1 per cent. The city’s benchmark index slumped 6.1 per cent last week, the most since October.

Tencent jumped 4 per cent to HK$344.80, while Alibaba Group added 2.6 per cent to HK$83.25. Insurer AIA Group strengthened 3.6 per cent to HK$84.45 and China Mobile rallied 4.6 per cent to HK$64.85.

Xpeng appreciated 2.6 per cent to HK$33.25 after joining the Hang Seng China Enterprises Index, which tracks the biggest mainland Chinese companies. Weibo, the Chinese microblogging platform operator, surged 4.7 per cent to HK$134.90 on its entry into the Hang Seng Tech Index.

While companies in Asia-Pacific excluding Japan posted record misses in fourth-quarter earnings, China, Singapore, Philippines and Indonesia have been the bright spots with results tracking above full-year estimates, according to Goldman Sachs.

“Consumer, TMT (telecoms, media and tech), and healthcare services/equipment will lead the recovery in 2023,” the Wall Street bank said in a report to clients. “Consensus earnings revisions have recently stabilised but upgrades are still absent, except for TMT.”