Late Tech Rally Leaves Many Rushing To Explain Move

While there seemingly wasn’t any fresh headline flow to drive the late rally in Chinese tech stocks, most are pointing to news delivered earlier in the week as the likely culprit.

• As a reminder, the Chinese finance ministry issued accounting rules on data resources in a push to support the development of the digital economy on Monday.
• Oversold technical parameters across the bulk of the widely-watched Chinese & HK indices would have given the space room to rally as well, with many of the indices at YtD/multi-month lows.
• Elsewhere, we also got the usual rounds of speculation pointing to potential state-backed purchases of equities.
• Others pointed to the recent equity-supportive and/or stimulus measures that have been outlined/implemented, but we don’t believe that would have been a major driver re: the late Tuesday move.
• Offshore participants continued their run of shedding exposure to mainland stocks, net selling CNY6.4bn of mainland equities via the HK/China Stock Connect mechanisms on Tuesday.