Chinese tech shares surged by the most in six weeks on Friday, with traders citing speculation of a possible near-term easing of the nation’s continued crackdown on internet companies.
The Hang Seng Tech Index jumped as much as 7% in Hong Kong, the biggest move since March 17, led by names like Alibaba Group Holding Ltd. and Meituan. It pared some gains and was up 5.9% at the mid-day break.
Traders cited rumors including one about an upcoming meeting between tech firms and policymakers related to the relaxation of the yearlong regulatory clampdown.
Meanwhile, Beijing is discussing with American regulators the logistics of allowing on-site audit inspections of Chinese companies listed in New York, people familiar with the matter told Bloomberg News, a sign of progress in talks to keep US stock markets open to issuers from Asia’s largest economy.
Friday’s rally also comes ahead of a critical Politburo meeting, with China’s senior leaders under pressure to discuss how to revive an economy hurt by Covid outbreaks. The nation’s strict Covid Zero policy has forced lockdowns from Shanghai to Beijing, adding to the concerns for investors already grappling with Federal Reserve rate hikes.
“There are some new buying orders when the market is rolling forward monthly Hang Seng futures exposure today, after futures settlement yesterday,” said Banny Lam, head of research at CEB International Investment Corp. “Some investors may be betting on a short rebound in technology stocks, as they are announcing earnings in May.”