By Yifan Wang 
 

Hong Kong technology stocks rose sharply in morning trade, buoyed by investors' hopes for a potential easing in U.S.-China tensions even though the outcome of the U.S. presidential election isn't clear yet.

The Hang Seng Tech Index tracked as much as 5.0% higher to 8149.00 to hit a fresh all-time high by midday trade, in line with overnight gains of the technology sector in the U.S. market.

"Overall the market thinks that the presidential election should be over soon, so that overhang is going to be removed," said Jefferies analyst Edison Lee.

A potential Joe Biden presidency may de-escalate current conflicts over the tech industry between the world's two largest economies. And even if President Trump is re-elected, the administration will likely shift policy attention away from China-related issues in the near term, Mr. Lee said.

"Previously, the focus on China was a campaign strategy," he added.

Nearly all subsectors within the industry are rising, with hardware companies leading gains. Cloud operator Kingsoft Corp. surged 8.7%, chip maker Hua Hong Semiconductor Ltd. jumped 12%, while smartphone-component supplier Sunny Optical Technology Group Co. was up 7.2%.

Internet giant Tencent Holdings also rose 5.4% while its peer Alibaba Group Holding rebounded 5.8% from Wednesday's losses due to the sudden IPO suspension of its financial arm Ant Group Co.

Delivery firm Meituan and e-commerce platform JD.com Inc. both hit all-time record highs, rising as much as 6.6% and 7.9%, respectively.

The industry's upbeat momentum was supported by China's recently unveiled new five-year plan, in which Beijing placed clear emphasis on technological development as one of the country's top economic priorities.

"China is very keen, very determined to continue to localize and focus on technology development," said Mr. Lee. "Although not every company will necessarily benefit, I think the market will just buy the sector right now."

 

Write to Yifan Wang at yifan.wang@wsj.com

 

(END) Dow Jones Newswires

November 04, 2020 23:31 ET (04:31 GMT)

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