Hong Kong Launches Share Index of Tech Giants

Hong Kong 's stock market has unveiled a new equity index based on China's technology giants.

The Hang Seng Tech Index went live on Monday and features internet companies including Tencent, Alibaba and JD.com, reports BBC.

It will feature 30 of the major tech companies listed in Hong Kong, who are among the biggest in the world.

The new index arrives as Chinese tech companies undergo further pressure in the US, with others gazing at the listings of both Hong Kong and China.

Jack Ma, the billionaire chairman of Alibaba, has recently revealed intentions to list its financial subsidiary Ant Group in Hong Kong.

Alibaba, NetEase and JD.com are three tech giants that have recently emerged in Hong Kong in the middle of rising strains between the US and China. We are part of the current Hang Seng App List.

The Ant Group is described as the world's most valuable unicorn - a start-up that has grown to a value of more than $1bn (£778m).

Once publicly listed, it should also move into the index.

Ant Group, a financial technology (fintech) firm, also wants to list on China's tech-centric Star stock market as it shuns a US stock market listing.

Analysts say the Hang Seng Tech index will attract investors to other Hong Kong tech stocks and look beyond the more well-known Hang Seng Index which is dominated by banks, property firms and energy companies.

"The new index aims to rival and beat the Nasdaq in the US market for Chinese tech giants," said Bruce Pang, head of macro and strategy research for China Renaissance Securities.

The Hang Seng Tech Index will track Hong Kong-listed companies that have high business exposure to selected technology themes, including the internet, fintech, cloud, e-commerce and digital activities.

What does it mean for investors?

Investment analysts claim that it will be more useful for investors who wish to purchase Chinese tech companies listed in Hong Kong to have their own tracker.

There is a tremendous demand for internet companies such as Alibaba and Tencent, which have usually done well through the coronavirus pandemic as more consumers go online for shopping and entertainment.

The new index could trigger the launch of investment funds tracking these 30 biggest tech stocks, known as Exchange Traded Funds (ETFs).

"This is a great and positive new addition, marking the continued growth in China's technology space and its mind and portfolio share of local and international investors alike," added Andy Maynard, managing director at China Renaissance investment bank.