Stocks across Hong Kong and China yesterday staged a stunning rebound after China’s state council vowed to keep its stock market stable amid a historic rout that erased US$1.5 trillion in value over the previous two sessions.
The Hang Seng China Enterprises Index, which tracks mainland companies listed in Hong Kong, jumped as much as 13 percent yesterday, its biggest gain since the global financial crisis.
A gauge of Chinese tech firms soared by a record, with Alibaba Group Holding Ltd (阿里巴巴) and Tencent Holdings Ltd (騰訊) gaining at least 24 percent.
Photo: Bloomberg
The eye-watering rally followed a report by Xinhua news agency that China would keep the stock market stable and support overseas share listing, citing a meeting chaired by Chinese Vice Premier Liu He (劉鶴).
The comprehensive statement also sought to resolve other woes that have plagued the market, particularly concerns over Beijing’s tech crackdown, saying efforts to “rectify” Internet platform companies should end soon.
Equities in the region have seen intense selling recently amid regulatory fears and speculation that Beijing’s ties with Russia might bring additional US sanctions. Cheap valuations had lured some dip buyers, but lingering risks, including a possible US delisting of Chinese stocks and a lockdown in tech hub Shenzhen, had been weighing on sentiment.
The statement also called for new policies to handle property developers’ risks, as well as a mention that regulators in both countries have achieved positive progress on the issue of Chinese stocks listed on US markets.
The report follows a series of articles by state media in recent days seeking to talk up sentiment.
“Usually the market’s natural bottom comes after the policy bottom, which we are seeing now,” JH Investment Management Co (建華投資管理) fund manager Li Weiqing (李偉青) said. “This time around things may be different, as the rout was looking like a financial crisis; the macro figures are also pointing to a bottom, but even if this is not the end, we can at least expect more stability in the next week or so.”
China’s benchmark CSI 300 Index closed 4.3 percent higher, the most since July 2020. Prior to yesterday’s session, the index was down more than 19 percent this year, one of the worst performing national benchmarks globally.
Even with the latest bounce, some market watchers say it is too early to call an end to the rout, maintaining a wait-and-see stance to see if the verbal promises materialize into concrete policies.
JPMorgan Chase & Co on Monday labeled some Chinese Internet names as “uninvestable” in the short term.
The 10-day volatility of the Hang Seng Index is higher than any major stock market benchmarks in the world.
Meanwhile, short sell turnover in Hong Kong shares accounted for more than 20 percent of total equity trading on Monday morning, the highest since late January, data compiled by Bloomberg showed.
“Personally I fear that the crisis the market faces is not just about China, it’s a global issue, and not just something that regulators can solve with this,” Quant Technology Investment fund manager Wang Mingxuan said. “The calm this brings is just the calm before the storm.”
Napoleon Osorio is proud of being the first taxi driver to have accepted payment in bitcoin in the first country in the world to make the cryptocurrency legal tender: El Salvador. He credits Salvadoran President Nayib Bukele’s decision to bank on bitcoin three years ago with changing his life. “Before I was unemployed... And now I have my own business,” said the 39-year-old businessman, who uses an app to charge for rides in bitcoin and now runs his own car rental company. Three years ago the leader of the Central American nation took a huge gamble when he put bitcoin
TECH RACE: The Chinese firm showed off its new Mate XT hours after the latest iPhone launch, but its price tag and limited supply could be drawbacks China’s Huawei Technologies Co (華為) yesterday unveiled the world’s first tri-foldable phone, as it seeks to expand its lead in the world’s biggest smartphone market and steal the spotlight from Apple Inc hours after it debuted a new iPhone. The Chinese tech giant showed off its new Mate XT, which users can fold three ways like an accordion screen door, during a launch ceremony in Shenzhen. The Mate XT comes in red and black and has a 10.2-inch display screen. At 3.6mm thick, it is the world’s slimmest foldable smartphone, Huawei said. The company’s Web site showed that it has garnered more than
CROSS-STRAIT TENSIONS: The US company could switch orders from TSMC to alternative suppliers, but that would lower chip quality, CEO Jensen Huang said Nvidia Corp CEO Jensen Huang (黃仁勳), whose products have become the hottest commodity in the technology world, on Wednesday said that the scramble for a limited amount of supply has frustrated some customers and raised tensions. “The demand on it is so great, and everyone wants to be first and everyone wants to be most,” he told the audience at a Goldman Sachs Group Inc technology conference in San Francisco. “We probably have more emotional customers today. Deservedly so. It’s tense. We’re trying to do the best we can.” Huang’s company is experiencing strong demand for its latest generation of chips, called
Vanguard International Semiconductor Corp (世界先進) and Episil Technologies Inc (漢磊) yesterday announced plans to jointly build an 8-inch fab to produce silicon carbide (SiC) chips through an equity acquisition deal. SiC chips offer higher efficiency and lower energy loss than pure silicon chips, and they are able to operate at higher temperatures. They have become crucial to the development of electric vehicles, artificial intelligence data centers, green energy storage and industrial devices. Vanguard, a contract chipmaker focused on making power management chips and driver ICs for displays, is to acquire a 13 percent stake in Episil for NT$2.48 billion (US$77.1 million).
RSS