HONG KONG: China and Hong Kong stocks rebounded on Wednesday, as the tech rally resumed on the country’s renewed AI push and financials rallied on CICC and Galaxy Securities’ high-stakes merger plan.
On the mainland markets, the Shanghai Composite index gained 1% at close to highest since December 2024, and the blue-chip CSI300 index rose 0.9%.
The Hang Seng Tech Index snapped a two-day decline to soar 4.5% and Hong Kong’s Hang Seng Index added 3.3% to hit fresh three-year highs.
Alibaba rallied 4.8%, recouping the losses from Tuesday, after announcing plans to make AI model for video and image generation publicly available. Meituan surged 9.8% and JD.com soared 8.5%.
This followed a similar action from startup DeepSeek, which is now rushing to release next-generation R2 model, Reuters reported.
“China’s tech re-rating narrative is still there on the back of AI optimism and the momentum should have a bit more room to go following a consolidation,” said Kenny Ng, strategist at Everbright Securities International in Hong Kong.
Chinese brokers surged after Reuters reported that state-owned China International Capital Corp (CICC) is set to merge with its peer China Galaxy Securities in a deal that would create the country’s third-largest brokerage.
The Hong Kong shares of the two brokerages jumped as much as nearly 20%, while those listed in Shanghai surged by their 10% daily limit after the news.
The financial sub-index climbed 1.3% to lead gains onshore, after Morgan Stanley raised price targets for key Chinese banks.
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