Hong Kong shares jump in bumpy session, China blue chips inch higher
Hong Kong shares bounced on Tuesday in a volatile morning session amid sector rotation by investors, while China's blue-chip stocks eked out a small gain after Monday's sharp sell-off. The Hang Seng index fell in the first half-hour of trade as tech shares slumped as much as 4.6%.Reuters | Hong Hong | Updated: 09-03-2021 10:36 IST | Created: 09-03-2021 10:20 IST
Hong Kong shares bounced on Tuesday in a volatile morning session amid sector rotation by investors, while China's blue-chip stocks eked out a small gain after Monday's sharp sell-off.
The Hang Seng index fell in the first half-hour of trade as tech shares slumped as much as 4.6%. However, the tech sub-index bounced back to trade 1.95% higher by the midday break, helping the broader index to finish the morning session up 1.35%. "This is just some volatile trading because we have seen a huge fall over the last few sessions," said Alex Wong, director at Ample Finance Group.
"The overall market is not that bad because people are just doing sector rotations ... they are not bearish on everything," he said, adding that he expected the market to stabilize. China's blue-chip CSI300 index edged up 0.03% after shedding more than 2% earlier in the day, as heavyweight consumer firms including Kweichow Moutai Co Ltd found their footing. The Shanghai Composite index trimmed earlier losses and was down 0.18%.
Kweichow Moutai, a favorite of foreign investors, rose 1.52% after a 4.86% drop on Monday, though it remains nearly 25% down from its Feb. 18 peak. Refinitiv data showed net inflows on Tuesday from foreign investors into A-shares through Stock Connect.
Traders dismissed reports that the market's turnaround on Tuesday as a result of state intervention, with a Beijing-based fund manager saying the market had been oversold on a gloomier outlook for stocks. "The pace of China's economic recovery slowed, according to PMI data for February, while rates have been rising continuously. Such a combination didn't bode well for equities," said Zheng Zichun, an analyst with AVIC Securities.
Investors have been forced out of popular stocks and into areas like small-cap shares by worries about how authorities might rein in frothy valuations. China's yuan also whipsawed on Tuesday morning, touching a two-and-a-half-month low before recovering all its losses by midday to trade at 6.521 per dollar.
(This story has not been edited by Devdiscourse staff and is auto-generated from a syndicated feed.)