Tencent reaches all-time high of HK$446.4 as tech shares push Nasdaq to fifth record close
The internet giant’s market value touched US$539 billion; Morgan Stanley recently raised target price citing growth prospect’s in mobile games business
Shares in Tencent hit a historic high of HK$446.4 on Tuesday, , after technology shares pushed the Nasdaq Composite to a fifth straight record close on Monday.
The Chinese internet giant opened higher at HK$441, surpassing the previous high of HK$439.6 in November. It rose further to a new all-time high of HK$446.4 intra-day, before ending at HK$443.8, up 1.2 per cent from the previous close.
That gave it a market value of HK$4.22 trillion (US$539 billion).
Tencent was the most actively traded stock in Hong Kong on Tuesday, with 24.5 million shares changing hands, worth HK$10.8 billion.
The gains followed an overnight advance in the tech-heavy Nasdaq Composite, which rose into record territory for a fifth consecutive session after Federal Reserve officials implied the US economy is strong enough to support more rate increases in 2018. Last week, the Nasdaq recorded the best opening four trading days in a year since 2006.
Tencent has also had a strong start to the new year, climbing nearly 9 per cent in the first five trading sessions.
It had plunged nearly 20 per cent since November, when US tech shares were slammed in a broad sell-off as investors rotated into other sectors.
Still, Tencent posted an annual gain of more than 110 per cent for 2017.
Last week, Morgan Stanley issued a report raising Tencent’s target price to HK$500 from the previous HK$480, citing growth in its mobile games business, in particular the flagship title Honour of Kings.
The analysts also expected Tencent’s recent acquisition of exclusive rights to PlayerUnknown’s Battlegrounds, the hottest video game of last year, to bring new growth impetus.
The bank forecast that Tencent’s market share in the world’s largest mobile games would increase to 72 per cent in 2019 from the 62 per cent in 2016.
Morgan Stanley had raised Tencent’s target prices several times in 2017, with its forecasts among the most bullish.