Hong Kong stocks surge as Beijing soothes frayed nerves over regulatory clampdown, pumps more liquidity into system
- Hang Seng and CSI 300 indexes climbed for a second day following a slump that erased more than US$1.2 trillion of value in local bourses
- Meituan and Tencent led a charge among Chinese tech stocks on report of a virtual call led by market regulator in Beijing
The Hang Seng Index surged 3.3 per cent to 26,315.32 on Thursday, the biggest rally in more than a year. The rally followed a 1.5 per cent rebound on Wednesday to halt a three-day rout. The CSI 300 Index, which tracks China’s biggest onshore stocks traded in Shanghai and Shenzhen, added 1.9 per cent while the tech-heavy ChiNext jumped 5.3 per cent for its biggest gain since February 2019.
Almost half of the 30-member Hang Seng Tech Index advanced by more than 10 per cent, powering the gauge up by record 8 per cent. Meituan rallied 9.3 per cent to HK$228 while Tencent Holdings soared 10 per cent to HK$491.80. Alibaba Group Holding, the owner of this newspaper, jumped 7.5 per cent to HK$196.90.
“If investors buy the new signals from Beijing, the market will continue to trend upwards,” said Louis Wong, director at Phillip Capital Management in Hong Kong. “Recent-issued regulations are still there and will have a long-term impact on the sectors.”
China’s regulatory actions, whether against internet-platform operators or after-school education firms, are not an attempt to restrict or clamp down the related industries but for the long-term development of the economy and society, the official Xinhua News Agency said in a commentary late Wednesday. It also stressed that China will continue to allow companies to go public in offshore markets.