Hong Kong Stocks Surge with Alibaba and Tencent in the Lead: A Look into a Sustainable Market Turnaround

Stocks in Hong Kong continue their upward trend led by tech giants Alibaba and Tencent. According to John Choi from Daiwa Securities, there's further room for growth as numerous stocks are currently valued less than their three- and five-year averages.

The Hang Seng Index saw a rise of 2.8 per cent, reaching 22,736.87 on Friday, bouncing back from a previous 1.3 per cent drop in early trading. The Tech Index also experienced a significant increase, with a 5 per cent surge. Mainland markets, however, will remain shut until October 7 due to a holiday.

Tencent, the company that owns WeChat, saw a rise of 2.4 per cent, bringing its value to HK$477.60. Alibaba also experienced growth, with a 3.5 per cent increase to HK$113.90. Similarly, e-commerce company JD.com saw a significant jump of 7.3 per cent, reaching a worth of HK$182.80. Additionally, online travel firm Trip.com saw a boost of 7 per cent, advancing to HK$543

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Upsurge or downfall: how enduring is China's stock market craze?

"A lot of investors were eager to observe the outcomes of the policies to validate a sustained market recovery," John Choi, analyst at Daiwa Securities, penned in a client memo. He indicated the rally has further potential as numerous stocks are currently being traded under their three- and five-year averages. He also pointed out that e-commerce firms would significantly gain from any additional stimulus actions.