China Tech Stocks Surge Most Since August After Hitting New Lows
(Bloomberg) -- Chinese technology stocks rebounded Thursday from a record low, following their American peers higher amid signs of renewed interest in one of China’s biggest tech names.
Hong Kong’s Hang Seng Tech Index jumped 5.2%, its biggest gain in more than six weeks, led by Meituan and Kingsoft Corp., which were both up at least 8.9%. Tech shares helped propel the broader Hang Seng Index, which advanced 3.1%.
“This level of volatility in the markets right now means there’s a lot of noise in price action,” said Kyle Rodda, a market analyst at IG Markets Ltd., adding that the U.S. rebound overnight had given scope for Hong Kong tech to bounce.
“Zooming out, things still look a little ugly for the Hang Seng, even for the day to day rallies we are sometimes seeing,” he said.
Sentiment was also lifted by plans for U.S. President Joe Biden to meet virtually with Chinese President Xi Jinping, and a media report that Daily Journal Corp. -- chaired by Warren Buffett’s longtime business partner Charlie Munger -- increased its stake in Alibaba Group Holding Ltd. by 83% last quarter.
“The market hopes more value investors, like Munger, will come back to tech but it’s too early to say the market has bottomed,” said Steven Leung, executive director at UOB Kay Hian in Hong Kong.
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Thursday’s rally caps the tech gauge’s five consecutive days of declines amid concerns a worsening energy crunch could stoke inflation and push up bond yields.
Hong Kong’s properties subgauge also rallied by 2% after analysts noted a lack of negative surprises in a policy address by the city’s chief executive Wednesday.
Markets on the mainland are set to reopen on Friday following the Golden Week holiday.
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