Baidu, Anta fuel Hong Kong market recovery on earnings tonic while investors retain hopes of China stimulus boost

Baidu rallies after revenues rose boosted by advertising spending; Sunny Optical slides after a plunge in first-half earnings

Sentiment remains fragile as investors holds on to slim hopes of forceful stimulus from Beijing to boost the local economy and markets

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A Chinese national flag in seen in front of screens showing the Hang Seng Index and stock prices outside Exchange Square in Hong Kong. Photo: Reuters

Published: 10:47am, 23 Aug 2023Updated: 4:32pm, 23 Aug 2023

Hong Kong stocks rose for a second day amid a mixed bag of corporate earnings results and investors retained hopes of further fiscal or monetary stimulus from Beijing to arrest a slump in confidence and growth.

The Hang Seng Index advanced 0.3 per cent to 17,845.92 at the close. The Tech Index added 0.2 per cent and the Shanghai Composite Index retreated 1.3 per cent.

China’s leading search engine provider Baidu advanced 4.4 per cent to HK$128.40 after revenue rose 15 per cent last quarter from a year ago, boosted by advertising spending. Anta Sports Products jumped 9.7 per cent to HK$85.20 after first-half profit beat estimates. China Life Insurance added 0.7 per cent to HK$11.30 and Construction Bank also rose 0.7 per cent to HK$4.09 as both prepare to issue their report cards later on Wednesday.

“We reiterate our view that Baidu maintains a market-leading position in both generative AI (artificial intelligence) and search-based advertising and should capitalise on both industries,” said Morningstar analyst Kai Wang in a note. “Baidu still has a first-mover advantage in its full-stack AI development and is planning to integrate Ernie with its existing services, which should complement its cloud and advertising revenue in the long run.”

Among top decliners, Country Garden slumped 6.7 per cent to HK$0.70 after the Chinese developer missed interest payments on its bonds. Sunny Optical fell 2.4 per cent to HK$63.05 after half-year profit tumbled 68 per cent from a year earlier.