The performance of the Hong Kong stock market has attracted the attention of many investors. In particular, the continued rebound in technology stocks has significantly boosted the overall rise in the market. As of press release, the Hang Seng Index surged nearly 2%, successfully breaking through and stabilizing above 17,000 points.

The continued rise in the Hang Seng Index is probably related to$TENCENT (00700.HK)$,$BABA-SW (09988.HK)$It is related to a rebound in popularity. Take Tencent as an example. The company's stock price has risen from HK$300 to HK$340 today, and its market capitalization has increased by HK$381.3 billion.

The significant rise in Tencent Holdings' stock price was mainly driven by the following positive factors. First, the HK$100 billion share repurchase plan announced by the company is regarded by Huachuang Securities as an important benefit. It is believed that this will effectively offset the financial pressure caused by shareholders' holdings reduction and have a positive impact on stock prices.

Second, Tencent officially announced recently that the highly anticipated mobile game “Dungeons and Warriors: Origins” will be launched on May 21, 2024. Most Wall Street analysts expect this to bring new growth impetus to Tencent's game business. Boosted by this positive news, Tencent's stock price rose sharply by 5.46% to HK$320.400 in a week, the biggest one-day increase since July last year.

Alibaba's market capitalization increased by more than 100 billion dollars

Alibaba's stock price also rebounded to a certain extent during the same period. The company rose from HK$66.7 to above HK$72 today, an increase of HK$110.32 billion during this period.

In terms of news, Alibaba founder Ma Yun published a post on the company's intranet entitled “Leading to Reform and Innovation”, which highly affirms the courage of change of the new management formed by Cai Chongxin and Wu Yongming, saying that Alibaba has returned to a healthy growth path and supports continued reforms. Notably, this is the first time in five years since his retirement that Ma Yun shared his thoughts on the company's reform, innovation and future prospects.

Furthermore, on February 7, Ali announced another increase in the share repurchase scale, increasing the total repurchase scale to 65 billion US dollars, which is the largest manual repurchase in the history of China Securities. Founders Ma Yun and Cai Chongxin also increased their holdings of Ali shares in the last quarter, highlighting their firm confidence in Ali's future development. In the fiscal year ending March 31, 2024, the company repurchased a total of 1,249 billion shares of common stock (equivalent to 156 million American Depositary Shares) for US$12.5 billion.

Why are Hong Kong stocks strengthening recently?

In addition to good individual dividends, the introduction of favorable policies has also boosted Hong Kong stocks. According to the “5 Capital Market Cooperation Measures with Hong Kong” issued by the China Securities Regulatory Commission on Friday, it involves further expanding the Shanghai-Shenzhen-Hong Kong Stock Connect mechanism, consolidating Hong Kong's position as an international financial center, and jointly promoting the collaborative development of capital markets between the two places.

Specifically, support policies include: easing the scope of eligible products for stock ETFs under the Shanghai-Shenzhen-Hong Kong Stock Connect; integrating REITs into the Shanghai-Shenzhen-Hong Kong Stock Connect; supporting the integration of RMB stock trading counters into Hong Kong Stock Connect; optimizing mutual fund recognition arrangements; and supporting leading enterprises in the mainland industry to go public in Hong Kong.

At the same time, UBS also upgraded the rating of Chinese stocks to overrated, saying that among the constituent stocks of the MSCI China Index, the consumer and internet industries account for a high share. As consumption shows initial signs of recovery, performance is expected to perform better.

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