Hong Kong stocks rebound as investors build defensive bets before Tencent’s earnings report

Hang Seng Index rebounded from biggest drop in three weeks as investors build defensive stocks

Tencent advanced before the WeChat operator’s quarterly earnings report later today, while Alibaba traded deeper below its 2019 IPO price

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Investors watch stock prices inside a brokerage hall. Stocks in Hong Kong rebound as market awaits Tencent’s earnings report. Photo: EPA

Published: 10:51am, 18 Aug 2021Updated: 5:47pm, 18 Aug 2021

Hong Kong and mainland China stocks rebounded from their biggest slide in three weeks as investors rotated into defensive stocks such as the solar and property sectors while technology giants struggled with regulatory challenges.

The Hang Seng Index gained 0.5 per cent to 25,867.01, halting a four-day slump. China’s Shanghai Composite and CSI 300 of the biggest stocks in Shanghai and Shenzhen both surged more than 1.1 per cent.

The Hang Seng Tech Index posted a marginal gain to reverse a five-day slump that erased almost 9 per cent of the value in the 30-member gauge. The index slipped 3.1 per cent on Wednesday for its biggest loss since July 27 after China unveiled draft rules to stamp out anti-competition practices.

Xinyi Solar led gains among blue chips in Hong Kong, soaring 6.5 per cent to HK$15.74. Hang Lung Properties gained 4.1 per cent to HK$21.50 and Ping An Insurance rose 3 per cent to HK$69.25. Bourse operator Hong Kong Exchanges and Clearing rose 1.6 per cent to HK$482.40.

“Investors need to stay calm and keep a level head, as the risks of market volatility have greatly increased following the correction in the [tech] sector,” Yan Jinkui, an analyst at Caida Securities, said in a research note. “There could be opportunities to pick up growth stocks at low prices once they enter correction territory.”