U.S.-listed shares of Chinese companies were enjoying a sharp rally in premarket trading Tuesday as hopes built about a potential relaxation of the country’s severe measures meant to help curb the spread of COVID-19.
The Wall Street Journal reported Tuesday that Hong Kong stocks appeared to be rallying after an anonymous post on Chinese social media suggested that the government may intend to soften pandemic-related restrictions beginning in March. Other outlets also reported on the rumor.
On U.S. exchanges, American depositary receipts (ADRs) for China stocks were surging broadly. Among big gainers were Chinese internet names including iQiyi Inc.
IQ,
up more than 10%; Bilibili Inc.
BILI,
up more than 9%; Huya Inc.
HUYA,
up more than 8%; JD.com Inc.
JD,
up. more than 7%; and Alibaba Group Holding Ltd.
BABA,
up more than 6%.
The KraneShares CSI China Internet ETF
KWEB
moved ahead by more than 7%. That ETF was off 47% in 2022 through Monday’s close, indicative of the tough stretch for Chinese technology stocks.
Also rallying were U.S.-listed shares of Chinese electric-vehicle companies Nio Inc.
NIO
and Xpeng Inc.
XPEV,
both of which reported October delivery numbers Tuesday morning. Nio disclosed in its delivery release that “vehicle production and delivery were constrained by operation challenges in our plants as well as supply chain volatilities due to the COVID-19 situations in certain regions in China.”