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Hong Kong shares rebound from three-week low as bargain hunters scoop up cheap stocks amid relief measures in city’s budget
- Buyers returned after a sell-off that erased US$141 billion of market value in technology stocks since Friday
- Hong Kong’s government unveiled its budget on Wednesday, unleashing a raft of stimulus measures to shore up the local economy
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Hong Kong’s benchmark stock index climbed from a three-week low, rebounding as traders scooped up beaten-down stocks amid a raft of relief measures offered by the city’s government to counter the economic effects of a resurgent Covid-19 outbreak.
The Hang Seng Index advanced 0.6 per cent to 23,660.28 at the close of Wednesday trading, ending a three-day losing streak. The city’s Tech Index gained 1.4 per cent, while the China Enterprises Index that tracks the performance of China-domiciled companies rose by 0.6 per cent.
Alibaba Group Holding, the owner of this newspaper, rose 0.9 per cent to HK$112.40. Tencent Holdings was little changed, while Meituan jumped 3.1 per cent. JD.com gained 3.6 per cent.
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“The regulatory environment has changed since last year and none of the news in the past few days has been incrementally negative from a fundamental perspective,” said Ling Vey-Sern, senior equity adviser for Asia technology at Union Bancaire Privée (UBP).
Buyers returned after a sell-off that had erased more than US$141 billion of market value in technology stocks since Friday. Stocks rebounded as the Hang Seng Index’s price-to-book ratio fell below one for a second day, according to Bloomberg data, signalling that blue-chip stocks were trading below their intrinsic asset values.
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The sell-off since Friday reinforced fears that Beijing was readying another assault on the internet sector, but analysts maintain that the regulatory danger has passed.
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