Hong Kong stocks jumped on Tuesday as investors sought alternatives for frothy US peers, while a gauge of Chinese mainland equities refreshed a decade high.
The Hang Seng Index advanced 1.4%, while the Hang Seng Tech Index jumped 1.5%.
In terms of star stocks, Mixue Group rose 7%; BYD rose 4%; NetEase and Kuaishou rose 3%; Li Auto, Bilibili, Baidu, Pop Mart, and JD.com rose 2%; Tencent rose 1%; while Xiaomi, Alibaba, and SMIC fell more than 1%.
Chinese technology stocks are back on global investors’ radar amid growing concerns about whether the elevated valuations of US peers will hold up after years of outsize gains. Co-founder of hedge fund Bridgewater Associates Ray Dalio said on social media that the artificial intelligence trade that underpinned US tech stocks was in the early stages of a bubble. The underperformance of US stocks against other major markets last year was a sign that investors were shifting to equities outside the US, he said.
Investors also boosted wagers that China will ramp up policy support to prop up economic growth in 2026 after the latest monthly data indicated a broad-based slowdown and property prices continued the downtrend.
Qiushi Journal, a publication of the Communist Party that is often viewed as an indicator of policy direction, ran an article on New Year’s Day that called for altering expectations for the property market and acknowledged the damage falling home prices have done to household wealth. The article fuelled speculation that policymakers might introduce bolder measures to overcome the market’s woes in 2026.
