Hong Kong stocks extend declines as volatility climbs to six-month high while Alibaba advances on Ant IPO prospects

Hong Kong stocks extended the biggest decline since May, with volatility spiking to a six-month high in a roller coaster week, as investors evaluated comments by China’s central bank governor that policymakers will maintain their loose monetary policy to support growth.

Alibaba Group Holding, the owner of this newspaper, gained in Hong Kong after China’s central bank hinted its affiliate Ant Group may be able to revive its stock offering. al in its affiliate Ant Group stock offering. Kweichow Moutai, the world’s most valuable distiller, dropped in Shanghai after the city started to rein in prices of premium liquor.

The Hang Seng gauge tumbled 2.6 per cent on Tuesday in Hong Kong’s worst stock market sell-off since May, after the world-beating run-up this year sent technical indicators to worrying levels. Hong Kong stocks, a laggard last year, started playing its catch-up at the turn of the year and sprinted to their best start since 1985.

Most major equity markets in Asia were mixed on Wednesday, after the People’s Bank of China (PBOC) governor Yi Gang assured investors that the world’s second-largest economy will not taper its supportive monetary stimulus “prematurely” during a virtual Davos event hosted by the World Economic Forum on Tuesday.