(Bloomberg) — Alibaba Group Holding Ltd. led an advance in US-listed Chinese stocks on Wednesday, as an approved fund-raising plan from Ant Group Co. boosted optimism that China’s regulatory crackdown on its internet sector has abated.
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Alibaba, which owns a stake in Ant, rose 7.5%, the biggest rise since November. Its e-commerce counterparts JD.com Inc. and Pinduoduo Inc. both by more than 6%. The Nasdaq Golden Dragon rose more than 5%, rising on a second day to its highest level in nearly four months.
Chinese stocks rebounded at the start of the year on bets that reopening the country would eventually boost the economy and corporate profits despite the initial turmoil.
Regulators have approved a plan by Jack Ma’s Ant to raise 10.5 billion yuan ($1.5 billion) for its consumer unit, clearing a hurdle before the fintech giant resumes its delayed initial public offering in 2020. The news indicated warmer relations between Chinese authorities and the state. . The largest technology companies, where officials put economic growth as their top priority.
Adding to optimism is more potential political support for the housing sector, a major weakness in China’s Covid-hit economy. Beijing plans to help shore up the balance sheets of some developers it deems “systemically important,” according to a Bloomberg report. The authorities have also resumed approvals for private equity funds to raise funds for residential real estate development.
As Wednesday progressed, the Hang Seng China Enterprises Index, a measure that tracks major Chinese stocks listed in Hong Kong, closed at its highest level since July. A recovery in mobility in some major cities has given hope that the number of Covid cases may have peaked, after the highly contagious virus pushed economic activity in the country to its slowest pace since February 2020.
– With help from Yiqin Shen.
(Updates chart and prices and adds Nasdaq Gold movement in second paragraph)
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