Tencent, Alibaba lead Hong Kong stock gains on earnings tonic while HSBC erases drop as banks hold rates after Fed, HKMA act

The HKMA lifted its base rate to a 15-year high, while commercial lenders like HSBC are expected to hold their prime rates, most analysts predicted

Tencent’s fourth-quarter earnings surpassed market expectations, while annual loss was narrower than consensus estimates

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Pedestrians walk past Exchange Square, the building housing the stock exchange in Hong Kong, on March 16, 2023. Photo: EPA-EFE

Published: 10:33am, 23 Mar 2023Updated: 4:53pm, 23 Mar 2023

Hong Kong stocks jumped by the most in three weeks as Tencent Holdings rallied after stronger than expected results, boosting confidence about corporate earnings outlook. Property developers advanced as local lenders refrained from raising borrowing costs to support growth.

The Hang Seng Index rose 2.3 per cent to 20,049.64 at the closing of Thursday trading to claw its way up from a three-month low. The Tech Index surged 4.7 per cent while the Shanghai Composite Index added 0.6 per cent.

Tencent jumped 7.5 per cent to HK$373.20, while Alibaba Group gained 3.9 per cent to HK$86.05. Sunny Optical advanced 5.4 per cent to HK$97.05, while shipping giant Orient Overseas International surged 16.3 per cent to HK$151.80.

Sun Hung Kai Properties added 0.4 per cent to HK$106.60, and Henderson Land rose 1.1 per cent to HK$27, leading gains among Hong Kong developers. HSBC climbed 0.1 per cent to HK$53.55 after losing as much as 2 per cent. The city’s biggest lender and other peers today kept their prime rate unchanged.

The Federal Reserve raised its key rate by a quarter point to a range of 4.75 per cent to 5 per cent overnight, while the Hong Kong Monetary Authority moved in lockstep to lift its base rate on Thursday to 5.25 per cent, a 15-year high. Most analysts contacted by the Post expected the city’s commercial banks to hold their prime rates.

“Hong Kong stocks might have already bottomed,” analysts at Huatai Securities said in a note on Thursday. Local investors are gradually turning back to the risk-on mode as concerns over the banking crisis have eased, and the market now expects a more dovish Fed, they added.