Hong Kong stocks edge up as Alibaba’s report card fails to inspire bulls while new China lockdown hits commerce hub

Stocks fail to catch fire after earnings at Alibaba Group slumped and revenue stagnated last quarter

Chinese commercial hub of Yiwu in eastern Zhejiang province is in quasi lockdown as officials seek to contain a new Covid-19 outbreak

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People walk past an electronic display of the Hang Seng Index in Hong Kong on August 4, 2022. Photo: AFP

Published: 10:47am, 5 Aug 2022Updated: 4:30pm, 5 Aug 2022

Hong Kong stocks rose for a third day, with the benchmark gauge posting its longest winning streak in a month, but mixed quarterly results from Alibaba Group Holding failed to inspire market bulls. A quasi-lockdown in the Chinese commercial hub of Yiwu also dented risk appetite.

The Hang Seng Index added 0.1 per cent to 20,201.94 at the close in seesawing trading, taking this week’s advance to 0.2 per cent. The three-day gain was the longest such stretch since June 28. The Hang Seng Tech Index rose 0.8 per cent, while the Shanghai Composite Index added less than 0.1 per cent.

The Taiex jumped 2.3 per cent in Taipei, the most in three weeks, erasing earlier losses spurred by US House speaker Nancy Pelosi’s visit to Taiwan, as traders absorbed the risk from China’s war games around the island.

Alibaba, the owner of the newspaper, tumbled 2.2 per cent to HK$92.90, surrendering some of its 9.1 per cent rally over the past two days. Tencent fell 1.4 per cent to HK$307.60 while Meituan slipped 0.2 per cent to HK$183.50.

Alibaba’s net income slumped by half and revenue stagnated, while contribution from Ant Group fell 17 per cent. The firm offered no guidance to 2023 prospects amid regulatory and macro challenges. Tencent and Meituan are due to report later this month.

“The market now has its focus back on the outlook of the global economy that will probably slip into a recession” and China’s economic challenges, Cinda Securities said in a note on Friday. “There’s lots of uncertainty ahead and the downside pressure on the Hong Kong market is still there.”

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