Tencent propels Hong Kong stocks higher for third straight day

Hang Seng Index ends up 0.9 per cent, or 273.08 points, at 30,809.22

PUBLISHED : Thursday, 10 May, 2018, 9:19am
UPDATED : Thursday, 10 May, 2018, 10:17pm

Shares in Chinese internet giant Tencent Holdings returned to above the HK$400 level on Thursday, propelling Hong Kong’s Hang Seng Index and remaining the biggest contributor of gains for a third straight day, as investors chased the stock amid expectations it could post strong quarterly earnings growth next week.

The Hang Seng Index ended up 0.9 per cent, or 273.08 points, at 30,809.22. It has now risen for four sessions in a row.

Tencent rose 2.9 per cent to HK$406.20, the first time it has closed above HK$400 in three weeks. Its rise was responsible for 81 points of gains on the Hang Seng Index, and the third day the tech giant had contributed the most to gains on the benchmark index.

Tencent is set to unveil first-quarter results on Wednesday next week, with markets expecting its revenues and profit to both show solid growth.

Goldman Sachs analysts expect it to record 48 per cent and 43 per cent rises in revenues and profit, respectively, driven by growth in online gaming business.

It also raised the valuations of Tencent’s online-only bank unit WeBank and streaming service Tencent Music, to US$60.5 billion and US$19.5 billion separately.

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The Hang Seng China Enterprises index rose 0.4 per cent, or 48.52 points, to finish at 12,233.96.

Turnover for the main board reached HK$93.2 billion, up 11 per cent from Wednesday. That was still lower, however, than the daily average of HK$128 billion during the first four months of year.

Andy Wong, senior investment analyst for Harris Fraser Group, said several uncertainties continue to weigh on investor sentiment, including higher US interest rates and trade tensions between China and the US.

Investor appetite for equities is likely to remain subdued unless the market is cheered by some special news, he added.

Sunny Optical Technology rose 0.9 per cent to HK$143.30. AAC Technologies advanced 1.7 per cent to HK$119.50.

Oil companies extended their recent rally, as CNOOC climbing 2.8 per cent to HK$13.90, and Sinopec gaining 1.5 per cent to HK$8.00.

In mainland trading, the Shanghai Composite Index also settled higher, up 0.5 per cent to 3,174.41. The large-cap CSI300 added 0.6 per cent to 3,893.06. The start-up board index ChiNext rose 0.5 per cent to 1,865.36.

Sinopec’s Shanghai-listed shares gained 1.1 per cent to 7.27 yuan. PetroChina improved by 1.3 per cent to 8.00 yuan. China Oilfield Services pulled higher by 1.1 per cent to 10.92 yuan.