(Bloomberg) -- Chinese technology stocks rallied to their highest level in more than a month after a new round of share buybacks by Tencent Holdings Ltd boosted market sentiment.
The Hang Seng Tech Index advanced 1.6% on Tuesday to the highest since late July, extending gains from last month's low to around 17%. Biggest point contributors included Meituan, Tencent and Alibaba Group Holding.
Tencent stepping into the market to buy back shares worth HK$100.5 million ($12.9 million) spurred traders to pile into the market this week. Fewer warnings and more targeted regulations by Beijing in recent days also provided relief.
“The lack of more bad regulatory news plus company share repurchases the last few days may be underpinning a continued shift in investor sentiment to being more constructive on China's tech stocks,” said Bloomberg Intelligence analyst Matthew Kanterman.
Tencent has been repurchasing its shares in the public market almost daily since announcing second-quarter earnings results on August 18. The technology bellwether has bought back a combined 2.2 million shares since at an average price of HK$464 per share, according to Bloomberg calculations.
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