While it wasn’t the largest gainer Wednesday Tencent Holdings Ltd. (HKEX: 07000) helped Hong Kong stocks finish their second straight day in the green on news that it is pursuing to create a $10-billion videogame streaming titan.
The Hong Kong-listed tech giant is in talks to merge some of China’s largest game streaming platforms Huya Inc. (NYSE: HUYA) and DouYu International Holdings Ltd., (Nasdaq: DOYU) as reported by Bloomberg today. Currently, Tencent owns a 37% stake in Huya and 38% of the equity in DouYu and has been discussing the merger with the two parties over the past few months, the report said.
At the close of trading today, Tencent rose 2% to HK$561 per share. Hong Kong’s benchmark, the Hang Seng Index closed nearly 156 points higher to bring its total now to 25,102.54 points. For the first time in roughly two weeks, the HSI has closed above 25,000 points. The two largest gainers on the benchmark today were oil and gas giant PetroChina Company Ltd., (HKEX: 00857) whose stock jumped 4% to HK$2.79 per share and telecommunications titan China Unicom (Hong Kong) Ltd., (NYSE: 00762) gaining 3% to HK$4.48 per share.
“Investors started to return to the market [in recent days] as they saw new economy stocks and Hong Kong Exchanges and Clearing [the exchange operator] regained momentum, leading to more confidence in the market,” Stanley Chan, director of research at Emperor Securities said, as cited by The South China Morning Post.
He added, “There’s still room for the [Hang Seng Index] to rise. It will not be surprising if it climbs to 25,500 to 25,800 in one to two weeks”.
In aftermarket trading yesterday in New York, HUYA soared 11% to $27.99 per American depositary share, while DouYu surged nearly 14% to $16.81 per share.
Shares of Tencent are up nearly 50% year-to-date.