Chinese tech stocks saw broad decline on Wednesday as support pledges from Vice Premier Liu He lacked fresh detail and new virus outbreaks around key cities weighed on investor sentiment.
The Hang Seng Tech Index fell as much as 2.3%, having rallied nearly 6% in the previous session.
Investors in Chinese tech sector are disappointed and awaiting more bolder policy promise and shots.
“Although investors are aware that there won’t be many punitive measures for tech from now, Covid concerns will continue to depress valuations across the board,” said Hou Anyang, fund manager at Frontsea Asset Management as reported by Bloomberg.
The meeting wasn’t enough to ease worries, he added.
Liu said the government will support the development of digital economy companies and their listing overseas.
While that sparked a more than 5% rally in a gauge of Chinese stocks trading in the US, the excitement waned in the Asia session.
“It is difficult to assess if Chinese equities have bottomed, especially with more economic pain to come as authorities persist on the Zero Covid path,” said Eli Lee, head of investment strategy at Bank of Singapore as reported by Bloomberg.
Still, in a sign of optimism, JPMorgan Chase & Co. analysts upgraded a number of tech firms including Alibaba Group Holding Ltd. and Tencent Holdings Ltd. to overweight earlier this week, just two months after deeming the sector “uninvestable.”
