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Hang Seng Index rises as Xiaomi overshadows slide in technology stocks, new benchmark index members falter

South China Morning Post logo South China Morning Post 15/03/2021
text: A man wearing a face mask walks past an electronic board showing the Hang Seng Index in June 2020 in Central. Photo: AP A man wearing a face mask walks past an electronic board showing the Hang Seng Index in June 2020 in Central. Photo: AP

Hong Kong stocks gained as smartphone maker Xiaomi soared after a US court suspended a ban on Americans investing in the company. Three stocks faltered on their first day of trading as benchmark index members.

The Hang Seng Index rose 0.6 per cent to 28,907.15 at local noon break, after tumbling 2.2 per cent on Friday for its biggest fall in two weeks. Major stock benchmarks in mainland China markets weakened amid heightened regulatory concerns.

Xiaomi rallied 9.2 per cent to HK$24.85 for the stock's biggest one-gain surge since August, overshadowing steep losses in technology peers. Xiaomi carries a 3 per cent weighting in the Hang Seng Index, according to Bloomberg data.

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A US court on Friday suspended a US government ban prohibiting US persons from owning its shares because of alleged ties to the Chinese military. CNOOC, which also faces US sanctions, jumped 2 per cent to HK$9.16.

Chinese technology giants fell after China's antitrust regulator fined entities related to a dozen technology groups including Tencent Holdings, Alibaba Group Holding, JD.com and Meituan for disclosure failures. The maximum fines, though small in sum, signalled enforcement against internet monopolies was strengthening.

"The bets on the technology giants may still face pressure in the short term," said Gao Jingdong, an analyst at Shanxi Securities International. "China's move to get tougher on the monopolistic practices and sprawling capital expansion, coupled with the lofty valuations of the tech stocks, will continue to drag down share prices."

Tencent fell 3 per cent to HK$631, while Alibaba, the owner of this newspaper, dropped 1.9 per cent to HK$221.60. JD.com plunged 5.6 per cent to HK$324.20, and Meituan declined 1.9 per cent to HK$326.60.

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Stock indices in mainland markets weakened amid concerns about fintech clampdown. The CSI 300 Index of the biggest stocks in Shanghai and Shenzhen declined 1.7 per cent. The Shanghai Composite slipped 0.6 per cent, while the tech-heavy ChiNext in Shenzhen retreated 3.4 per cent.

In Shanghai, liquor distiller Kweichow Moutai fell 2.4 per cent to 1,976.80 yuan, while China Tourism Group Duty Free dropped 4.2 per cent to 296.50 yuan.

Alibaba Health Information Technology, mainland Chinese developer Longfor Group and hotpot chain Haidilao International joined the benchmark Hang Seng Index as constituent stocks on Monday.

Alibaba Health added 0.4 per cent to HK$24, reversing earlier losses. Longfor fell 1.8 per cent to HK$48.25 and Haidilao dropped 2.3 per cent to HK$56.20.

Autohome, an online platform for buying and selling cars, gained 2.4 per cent in Hong Kong from its secondary listing price of HK$176.30.

Markets in Asia-Pacific were mixed. Japan's Nikkei 225 edged up 0.1 per cent, while South Korea's Kospi slipped 0.1 per cent. Australia's S&P/ASX 200 was little changed.

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This article originally appeared on the South China Morning Post (www.scmp.com), the leading news media reporting on China and Asia.

Copyright (c) 2021. South China Morning Post Publishers Ltd. All rights reserved.

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