Hong Kong stocks edge up amid regulatory jitters following Tencent action

The Hang Seng Index rises 0.2 per cent, trades near seven-week low

Haidilao and Alibaba, stocks with the biggest losses this year, lead the benchmark higher

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Hong Kong’s Central business district. Photo: Bloomberg

Published: 10:40am, 25 Nov 2021Updated: 4:46pm, 25 Nov 2021

Hong Kong stocks edged up at the close on Thursday, with the benchmark hovering around a seven-week low amid concerns about a regulatory crackdown in China that has crippled industries ranging from technology and ride-hailing to private education.

The Hang Seng Index rose 0.2 per cent to 24,740.16 for the day, reversing an intraday loss of as much as 0.6 per cent. The Hang Seng Tech Index rebounded 1.1 per cent, while China’s Shanghai Composite Index dropped 0.2 per cent.

Stocks with the biggest losses this year led the benchmark higher on Thursday, with Haidilao International Holding and Alibaba Group Holding rising at least 2.7 per cent. The two stocks have lost more than 40 per cent so far in 2021. New World Development was the worst performer, with a decline of 5.6 per cent.

In its latest onslaught, China has suspended Tencent Holdings, the operator of WeChat with its 1.2 billion users, from launching new apps and updating its existing apps as part of a “temporary administrative guidance”, according to local media reports. Tencent indirectly confirmed the reports, saying in a statement that it was cooperating with the authorities.

The punitive measure is expected to further sour sentiment around Chinese technology stocks trading in the city, which are already reeling from a new bout of sell-offs after big earnings misses by Alibaba and Bilibili. Some traders have been burned as they had bet that Beijing’s regulatory storm was nearing an end and that the battered valuations of the sector were in for a rebound.

“Hong Kong stocks are still facing a couple of issues that have remained as an overhang, such as the antitrust law, uncertain policies, the debt woes of Chinese developers and the power outage,” Central China Securities said in a report on Thursday.

Hong Kong stocks edge up amid regulatory jitters following Tencent action

.css-1mniedq{color:inherit;font-weight:inherit;font-size:inherit;font-family:inherit;line-height:inherit;} The Hang Seng Index rises 0.2 per cent, trades near seven-week low Haidilao and Alibaba, stocks with the biggest losses this year, lead the benchmark higher

The Hang Seng Index rises 0.2 per cent, trades near seven-week low

Haidilao and Alibaba, stocks with the biggest losses this year, lead the benchmark higher