Hong Kong stocks reclaim 3-week high as gains in Alibaba, developers overcome setback caused by worst Covid-19 outbreak

Alibaba added to its biggest gain in five weeks while Country Garden paced winners among Chinese property developers on prospects of policy loosening

HSBC and banking peers stumbled after Hong Kong recorded the biggest surge in infections since the onset of pandemic

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A woman walks past an electronic board in Mong Kok showing the closing Hang Seng Index number in June 2020. Photo: Edmond So

Published: 10:46am, 10 Feb 2022Updated: 5:04pm, 10 Feb 2022

Hong Kong stocks rose to a three week-high as gains in property developers and Alibaba Group Holding countered earlier setback caused by a record surge in Covid-19 infections in the city.

The Hang Seng Index climbed 0.4 per cent to 24,924.35 at the close of Thursday trading, overturning a loss of as much as 0.7 per cent. The Tech Index added 0.6 per cent as Alibaba rebounded for a second day. The Shanghai Composite Index advanced 0.2 per cent.

Country Garden Holdings and China Overseas Land & Investment rallied at least 3.8 per cent, driving a 1.6 per cent in the industry sub-index as the top performer. Investment banks including CCB International expect policymakers to further ease curbs on the housing market next month.

“We anticipate homebuyer sentiment to gradually improve in the second quarter after policy relaxation is reaffirmed in the `Two Sessions in March and excessive liquidity gradually channelled to the property sector,” said Lung Siufung, a Hong Kong-based analyst at CCB International.

Alibaba, the owner of this newspaper, advanced 2.9 per cent, adding to a 6.8 per cent rally on Wednesday as SoftBank rejected reports it could be selling its stake. Live-streaming platform operator Bilibili advanced 4.5 per cent.

GCL-Poly Energy Holdings, the maker of silicon used in solar products, added 2.8 per cent after saying that the board was studying the possibility of listing the company on the mainland’s exchanges.

Alibaba has recouped most of the slide since its February 4 filing on new issuance of American depositary shares. Photo: AP

The gain has cemented the Hang Seng Index as the best performer among the major Asia-Pacific benchmarks this year with a 6.5 per cent gain. A 14 per cent drop in 2021 made the market the cheapest next to Brazil among major global peers.