Ant climbs wall of worry in world stocks

Ant Group raked in more than HK370 billion for its mega initial public offering in Hong Kong while the world's stock markets slumped yesterday as the Covid pandemic worsened.

Lockdown fears in Europe, US elections jitters and rising coronavirus cases sent stocks lower with the Dow losing nearly 900 points in the morning session.

Major European markets were down between 3-4 percent.

Hong Kong stocks were largely unaffected which analysts attributed to Ant's IPO, with Tencent and Alibaba reaching new record highs.

But they warned investors that the calm in Hong Kong may not last for long in the face of market volatility across the world.

Ant Group received at least HK$370 billion in margin financing, according to SAR brokers and banks. That was equivalent to a 110-times over-subscription for the retail tranche.

The Hong Kong and Shanghai Bank Corp had received over HK$93 billion margin financing by 6pm yesterday. Each investor subscribed to around 326 board lots on average. That meant each invested HK$1.31 million.

Previously, if the market plunged suddenly or a market situation worsened, investors might have withdrawn their subscription on initial public offerings.

Tencent rose 2.74 percent to HK$601 yesterday after touching HK$604 - its highest ever - in afternoon trading.

Alibaba was up 2.47 percent to HK$307.40. It reached a record high HK$309.40 in the morning.

The HSI, supported by two tech giants, slid only 78 points, or 0.32 percent, to 24,708.

Dickie Wong, executive director of research at Kingston Securities, said the Hang Seng Index most certainly gained support from Tencent and Alibaba on Ant's listing. But the HSI could fall and stay below 25,000 points after the Ant action.

While Hang Seng Index futures fell over 150 points to 24,405 by late night the Hang Seng Tech Index outperformed the market. It closed 108 points, or 1.4 percent, higher at 7,656.

Wong also predicted new economy shares will continue to outperform the market.

Also noteworthy yesterday were shares of ZhongAn Online P&C Insurance rising 4.75 percent after the company said it received approval from the China Securities Regulatory Commission to convert 950 million domestic shares into H shares.

Meanwhile, Alibaba's Tmall will launch more than 50 hours of live stream program in Hong Kong as part of its promotion for the upcoming Double 11 shopping festival.