Hong Kong stocks greet 2021 with tech rally, China’s big telcos pare losses triggered by NYSE delisting

Technology and smartphone parts suppliers keep Hang Seng Index on firm opening while China’s big telecoms companies, oil giants pare earlier deep losses

The Shanghai Composite Index added 0.9 per cent, after a 13.9 per cent advance in 2020

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Reflection of pedestrians on an electronic board showing the Hang Seng Index in Central. Hong Kong and China stocks advanced on first day of 2021. Photo: May Tse

Published: 10:56am, 4 Jan 2021Updated: 12:27pm, 5 Jan 2021

Hong Kong and China stocks rose on the first day of 2021 trading as technology stocks related to smartphone manufacturing surged. A slump in some of China’s biggest phone carriers and oil companies receded as traders evaluated the impact of US delisting action.

The Hang Seng Index added 0.9 per cent to 27,472.81 at the close. It surged 16 per cent last quarter, helping to narrow the decline in 2020 to 3.4 per cent. The Shanghai Composite Index also advanced by 0.9 per cent to 3,502.96. The gauge jumped 7.9 per cent last quarter, bringing the rally in 2020 to 13.9 per cent.

Smartphone maker Xiaomi Corp climbed 6.2 per cent to HK$35.25 to extend its record-breaking run, while Sunny Optical Technology jumped 4.2 per cent to HK$177. The 31-member Hang Seng Tech Index rose 0.8 per cent, after a 90 per cent surge over the past three quarters.

Hong Kong’s stock market has greeted the first day of trading with a winning start in eight of the past 10 years, according to Bloomberg data. Reports over the weekend also aided optimism, with Financial Secretary Paul Chan Mo-po saying the city could exit from its worst recession this year. The economy likely shrank 6.1 per cent in 2020, according to official estimate.

Elsewhere, the Caixin/Markit manufacturing purchasing managers’ index, which tracks sentiment among smaller, private firms, fell to 53.0 last month from a decade-high 54.9 in November. While upbeat, December’s reading was the softest in three months, today’s report showed.

Equities gained across major Asia-Pacific markets with benchmark in Australia and Taiwan rising by more than 1.2 per cent while South Korea’s Kospi surged 2.5 per cent. Stocks in Japan slipped 0.7 per cent.