Hong Kong stocks rise to 3-year high as investors return to tech following US sell-offs

Optimism among investors is rising that Beijing will use more resources this year to support innovation

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Published: 10:42am, 26 Feb 2025Updated: 4:57pm, 26 Feb 2025

Hong Kong stocks hit a three-year high on Wednesday, as a correction for the largest US tech firms turned investor attention to their Chinese counterparts, which led a gauge of local tech stocks to briefly breach the 6,000-point mark.

The Hang Seng Index jumped 3.3 per cent to 23,787.93 at the close, a level not seen since February 21, 2022. It also wiped out a decline of 1.9 per cent recorded over the past two days. The Hang Seng Tech Index surged 4.5 per cent to finish just shy of 6,000, a threshold it touched briefly for the first time since December 2021.

On the mainland, the CSI 300 Index climbed 0.9 per cent and the Shanghai Composite Index added 1 per cent.

Alibaba Group Holding, which owns the Post, added 4.8 per cent to HK$136.90, recovering most of its losses from the past two days. E-commerce rival JD.com advanced 8.5 per cent to HK$168.10. Tencent Holdings gained 3.4 per cent to HK$501.50 and Meituan climbed 9.8 per cent to HK$174.20. Budweiser Brewing surged 10 per cent to HK$8.66 after appointing a new CEO to turn its slumping business around.

“There’s an ongoing rebalancing for global funds and the Chinese market has regained favour,” said Melody Lai, an analyst at SPDB International in Hong Kong. “Funds have been rotating from the US and India to China and Europe, where the positionings are low among global investors. China’s markets have the valuation edge among the world’s key stock markets. So foreign inflows are expected to continue in the near term.”

Investors have been returning to China’s biggest tech stocks after a pullback triggered by overbuying, with optimism rising that Beijing would use more resources this year to support innovation as the China-US rivalry intensifies. Premier Li Qiang called for more technological breakthroughs in a visit to the nation’s largest state-owned telecoms operators, according to China Central Television.