Hong Kong rises as Alibaba buys back 2.1% of outstanding shares in the third quarter

Hong Kong rises as Alibaba buys back 2.1% of outstanding shares in the third quarter

Important news

Asian stocks fell on tensions in the Middle East, with the exception of Hong Kong which had a very strong day.

Mainland China remains closed for the week-long national holiday, Taiwan is closed due to a typhoon and India is closed for Mahatma Gandhi Jayanthi, celebrating the birth of Gandhi.

Hong Kong rose, led by growth stocks with strong volume that was 398% of the 1-year average. There was strong breadth with 437 stocks closing higher, while there were only 68 declines as every sector and sub-sector was higher. The strong volume was achieved excluding purchases via Southbound Stock Connect/Mainland, which typically accounts for nearly a third of Hong Kong sales, which along with Mainland China remain closed until next Tuesday. The most heavily traded exchanges in Hong Kong in terms of value were Tencent with an increase of +5.71%, Alibaba with an increase of +4.64%, Meituan with an increase of +14.65%, Hong Kong Exchange with an increase of +14% .29%, Ping An Insurance up +12.86% and JD. com rose +10.77% as the company will benefit from home appliance trade-in subsidies.

Electric vehicle stocks had a strong day following September sales numbers. After the close, Alibaba announced in the third quarter that it spent $4.1 billion to purchase 414 million shares/52 million ADRs, reducing the company’s outstanding shares by 2.1% (I have the Announcement posted on X/Twitter @ahern_brendan). The six Hong Kong-listed real estate stocks remaining in the MSCI China All Shares rose +17% on policy support for the struggling sector, with Suanc up +75% and Vande up +61%. I’ve pointed to US dollar-denominated Asia High Yield bonds as a great way to take advantage of the real estate recovery – to no avail, because despite high yields, I don’t care.

China’s monetary and fiscal stimulus has left some investors struggling to correct their significant underweight to China. Mainland Chinese media noted a report from a global bank that hedge funds quickly corrected their underweighting, although that weighting is still well below levels three to four years ago. Mainland China futures trading in Hong Kong and Singapore are up 8.19% and 7.35% respectively, indicating a very strong performance once the mainland reopens next Tuesday. I expect the STAR board to have a good day as local investors focus on small caps while foreign investors focus on large/liquid mega caps.

Sina Finance published an article about the struggle to open brokerage accounts for mainland investors. Sixty brokerage houses remained open during the national holiday to open accounts for new customers. One broker found that the number of new account openings was three times higher than normal, while password retrieval increased six times. The China Securities and Depository and Clearing Corporation was expected to release the number of new brokerage accounts opened next week.

Hang Seng and Hang Seng Tech gained +6.2% and +8.53%, respectively, with volume down -14.2% from Monday, representing 398% of the 1-year average. 437 stocks rose while 68 fell. Mainboard short sales volume decreased -3.95% from Monday, which is 327% of the 1-year average, as 14% of the sales were short sales (Hong Kong short sales turnover includes the short volume of ETFs generated by the ETF -Hedging the market makers is controlled). ). Growth and small-cap stocks outperformed value and large-cap stocks. All sectors were positive, with Real Estate up +17.03%, Financials up +8.25% and Consumer Discretionary up +7.66%. All subsectors closed higher, led by diversified financials, real estate and consumer discretionary. Southbound Stock Connect is closed until next Tuesday.

Shanghai, Shenzhen and the STAR Board are closed until next Tuesday.

Upcoming webinar

Join us October 3rd at 11:00 a.m. EDT for:

From Jupiter

Jupiter
to Jiangsu: How Astrophysics Influences AI-Powered Investing

Please click here to register

New content

Read our latest article:

Expansion of the KraneShares Volatility Suite with KPRO & KBUF

Please click here to read

Last night’s performance

Last night’s exchange rates, prices and returns

Closed.