China tech stocks stage muted rebound
Hong Kong-listed Chinese tech stocks rose for the second day in a row on Wednesday, continuing a rebound from a sell-off triggered by regulatory action in the US and China.
Video streaming platform Bilibili led gains, rising by as much as 8.3 per cent in early trading. That was followed by ecommerce group Alibaba, which opened 5.3 per cent higher. Both stocks declined last week.
Online travel company Trip.com, which fell last week after swinging to a loss in its quarterly earnings, also gained by as much as 5.9 per cent.
The Hang Seng Tech index rose as much as 2.5 per cent in early trading, following a comparable rise on Tuesday, after losing more than 7 per cent last week.
Chinese tech stocks have been volatile as a result of interest rate rises in Europe and the US and regulatory actions from Washington and Beijing.
The Nasdaq Golden Dragon China index, which tracks Chinese companies listed in the US, gained 7 per cent in New York on Tuesday.
The latest increases came as some Chinese tech stocks matched a rally in the US, said Jeffrey Halley, senior market analyst for Asia Pacific at OANDA. But Halley warned the tech stock sell-off “wasn’t over yet”.
“[China tech] crawls up but is still falling much faster than it rises,” said Halley, citing the tension between the US and China as a driving factor of the declines.
The Hang Seng index was up by as much as 1.3 per cent and China’s CSI 300 was flat after gaining 0.5 per cent. Markets in Australia and Japan were also flat.
The Hang Seng Mainland Properties index, which tracks the Hong Kong-listed stocks of 10 of China’s biggest developers, fell by as much as 1.9 per cent after a surprise rise of 2.4 per cent on Tuesday.
In commodity markets, West Texas Intermediate contracts rose 0.13 per cent to trade at $71.21 per barrel, gold contracts for February delivery edged downwards. The yield on the 10-year Treasury note fell two basis points to 1.46 per cent.
Futures in the US also pointed down after a rebound on Tuesday in which the S&P 500 index clawed back its Monday losses and the Nasdaq Composite rose 2.4 per cent.
Investors remained concerned over the prospect of greater travel restrictions to combat the spread of the Omicron coronavirus variant.