WuXi Biologics plunges again in setback for Hong Kong market while Li Auto, Geely lead EV surge on strong deliveries
- China approved 32 imported online games on Thursday in a sign of its softening stance on the industry
- Li Auto and Geely rose after recording increases of 58 to 110 per cent in January deliveries versus year-ago levels
The Hang Seng Index dropped 0.2 per cent to 15,533.56 at the close, erasing an earlier rally of as much as 2.2 per cent and taking the loss for the week to 2.6 per cent. The Tech Index slipped 0.7 per cent, reversing a 3.3 per cent gain, while the Shanghai Composite Index slipped 1.5 per cent.
WuXi Biologics plunged 21 per cent to HK$16.78, while its affiliate WuXi AppTec tumbled by the same magnitude to HK$43.70. Both stocks slumped 32 per cent this week after a US lawmaker moved a bill to block Chinese biotech firms from doing business with the US government.
Alibaba Group fell 0.5 per cent to HK$70.70 and e-commerce rival JD.com lost 1.7 per cent to HK$86. Baidu shed 0.8 per cent to HK$102 and Hong Kong Exchanges and Clearing dropped 1.4 per cent to HK$233.40.
“There has been no significant improvement in fundamentals and that is exacerbating market sentiment to cause the persistent declines,” said Shen Fanchao, an analyst at Zheshang International. “We are cautious about Hong Kong stocks in the near term, and the key to breaking this bad cycle is more state policy support.”
The Hang Seng Index is the worst performer among major equity benchmarks this year, with a loss of 8.9 per cent. A lack of forceful stimulus and the Federal Reserve’s reluctance to cut rates have clouded the market outlook. China’s manufacturing shrank for a fourth month in January, the statistics bureau said this week.
“We view this as a positive surprise as [Tencent’s] title is highly anticipated by the market,” analysts at Jefferies said in a report on Friday. The industry regulator “is supporting prosperous and healthy sector development,” they added.
Among EV makers, Li Auto surged 2.4 per cent to HK$111.80 and Geely strengthened 4.4 per cent to HK$7.66. They recorded 58 to 110 per cent increases in January deliveries versus year-ago levels, according to filings. Chinese EV makers delivered 8.9 million units in 2023, a 37 per cent annual jump, the industry association said.
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Longfor Group jumped 2.8 per cent to HK$8.70, leading gains among mainland Chinese developers after the central bank injected 150 billion yuan (US$20.9 billion) of low-cost funding to support the sector. China Resources Land added 1.1 per cent to HK$23.50, and China Overseas Land rose 1.7 per cent to HK$11.76.
Two companies debuted on Friday. Jiangsu Huayang Intelligent Equipment jumped 114 per cent to 59.97 yuan in Shenzhen, and Zhejiang Chemsyn Pharm was unchanged at 19.90 yuan in Beijing.
Other major Asian markets rose. Japan’s Nikkei 225 climbed 0.4 per cent, while South Korea’s Kospi jumped 2.9 per cent and Australia’s S&P/ASX 200 added 1.5 per cent.
