Hong Kong stocks extend rally to two weeks on Tencent, Alibaba gains as China pledges steady growth with reopening push
- Premier Li Keqiang says China is aiming for steady growth next year amid measures to reopen the economy
- Daily Covid-19 cases have eased to about 21,000 nationwide, from all-time high of more than 40,000 last month
The Hang Seng Index rose 2.3 per cent to 19,900.87 at the close of Friday trading, adding to a 3.4 per cent rally on Thursday and rising by 6.6 per cent for the week. The Tech Index climbed 2.3 per cent on Friday, while the Shanghai Composite Index added 0.3 per cent.
Tencent Holdings gained 2.6 per cent to HK$325.60, Alibaba Group gained 2.7 per cent to HK$91.85, and Meituan jumped 5.7 per cent to HK$188.50. Developer Country Garden surged 8.5 per cent to HK$3.06, Sun Hung Kai rose 4.3 per cent to HK$102.50 and New World Development gained 6.7 per cent to HK$22.25. China’s Tesla challengers Nio and Xpeng added 3.7 to 4 per cent.
“Sentiment continued to recover over the latest Covid policy,” analysts at Morgan Stanley including Laura Wang said in a note on Friday. “With a set reopening path, we believe Chinese equities will outperform global markets.”
The Hang Seng Index’s 6.6 per cent rally over the past five days adds to a 6.3 per cent gain in the preceding week, helping the broader Hong Kong stock market recoup more than US$1 trillion of value since the benchmark recovered from its October low on China reopening bets.
“It’s still good level for allocations by long-term funds, as we have better expectations for the economy and attractive valuations,” HSBC Jintrust Fund Management said in its latest monthly newsletter to clients.
China reported 16,592 of daily Covid-19 infections nationwide on Friday from 21,165 a day earlier, according to data released by the National Health Commission. Cases surged past 40,000 levels late last month, a record since the Wuhan outbreak in early 2020.
Elsewhere, Asian stocks jumped after US shares posted their first winning day in December. Benchmark indexes in Japan, South Korea and Australia rose by 0.5 to 1.2 per cent on Friday.
With additional reporting by Zhang Shidong.