Alibaba Soars 12% as Chinese Tech Stocks Surge

Ant Group and Alibaba are independently seeking new business as the Jack Ma-founded companies navigate China's regulatory crackdown, sources say. File photo: Reuters.

E-commerce giant Alibaba led a spike in Chinese technology shares on Friday on the back of upbeat first-quarter earnings estimates.

Alibaba’s Hong Kong-listed shares rose as much as 12%, shrugging off months of widespread Covid-19 lockdowns and supply chain disruptions in the world’s second-biggest economy. The stock was up 11.8% at HK$90.70 at 2pm Hong Kong time.

The surge followed a 14.8% surge in Alibaba’s New York-listed American depositary receipts, which closed at $94.48 on Thursday.

The surge came despite Alibaba declining to provide a forecast for the current fiscal year because Covid-19 risks clouded its outlook, after reporting its slowest quarterly revenue growth since going public in 2014.

The markets, however, focused on Alibaba’s quarterly revenue and earnings in a sharply weakening economy.

Analysts said the results were more resilient than expected.

“As Alibaba’s large scale reflects the overall macro economy, we believe it is the key beneficiary of a potential favourable policy rollout in terms of lockdown measures and consumption stimulus,” Daiwa Capital analysts said in a note.

Alibaba helped Hong Kong’s Hang Seng Tech index rise nearly 4% at 2pm on Friday, with all 30 of the companies listed on the benchmark making gains.

Chinese search engine group Baidu’s shares soared 15.5% after the company reported higher sales. Shares in JD.com rose 5.8% after the e-commerce company reported an 18% rise in revenues.

George Russell, with Reuters

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George Russell

George Russell is a freelance writer and editor based in Hong Kong who has lived in Asia since 1996. His work has been published in the Financial Times, The Wall Street Journal, Bloomberg, New York Post, Variety, Forbes and the South China Morning Post.