(Bloomberg) — Chinese tech stocks jumped as traders bet a key meeting Tuesday between the nation’s top regulators and corporate giants would result in Beijing dialing back its yearlong clampdown of the industry.
The Hang Seng Tech Index rallied 5.8%, the most this month, with Sunny Optical Technology Group and Li Auto Inc. the top performers. JD.com Inc. also traded higher ahead of its earnings later in the day.
China’s top political advisory body is hosting a symposium related to the digital economy, according to state media. While the outcome wasn’t released within trading hours, a Reuters report showed Chinese Vice Premier Liu He is scheduled to speak at the meeting also attended by private-sector executives like Baidu Inc. founder Robin Li. Investors closely watched for clues to whether the rout in technology stocks could near an end.
Signs of a turnaround in the tech sector may be already underway. On Monday, JPMorgan Chase & Co. analysts upgraded a number of tech firms including Alibaba Group Holding Ltd. and Tencent Holdings Ltd. to overweight from underweight just two months after deeming the sector “uninvestable”.
“Market may trade ahead of it, then wait to see the outcome to adjust the view,” said Willer Chen, analyst at Forsyth Barr Asia Ltd., referring to the tech meeting.
Following the yearlong crackdown on private enterprise, a number of top officials have vowed to stabilize markets in recent months. That’s given rise to bets that the worst days of tech regulations may be over.
Expectations that Shanghai may soon ease its strict lockdown measures are also adding to hopes after the city reported no community cases for a third day.
Still, it’s not clear whether the rules will be relaxed significantly enough to give markets a sustainable boost. China’s dogged adherence to zero tolerance for Covid has hit industrial output and consumer spending.
On the mainland, the CSI 300 Index gained 1.3%. The Hang Seng Index rose 3.3%.
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