Alibaba split-up plan boosts Hong Kong stock market; China edges up

China's CSI 300 benchmark, meanwhile, edges up 0.2%, as investors await more data to gauge the country's economic recovery

Hong Kong stocks surged on Wednesday, boosted by a jump in Alibaba's shares following the internet giant's revamp and listing plan which fuelled optimism that Beijing's crackdown on the tech sector may be ending.

Alibaba said on Tuesday it was planning to split into six units and explore fundraisings or listings for most of them, in the biggest restructuring of the technology conglomerate in its 24-year history.

Hong Kong-listed Alibaba was up 13.2% by the lunch break, after surging as much as 16.3% in early morning trade.

The index heavyweight lifted the Hang Seng Tech Index by 2.7%, while also sending the Hang Seng benchmark .HSI up 1.9%.

China's CSI 300 benchmark, meanwhile, edged up 0.2%, as investors awaited more data to gauge the country's economic recovery after it dropped stringent zero-COVID curbs and reopened its economy.

In Hong Kong, major internet firms Tencent, Meituan and JD.Com rose between 2% and 5%, cheered by Alibaba's breakup plan.

"Investors were generally positive on the news as the regulatory risk is significantly reduced," said Steven Leung, executive director of institutional sales at UOB Kay Hian (Hong Kong) Ltd.

"Alibaba is a showcase and similar restructuring may roll over to other companies if it is proven to be a success."

The revamp also comes a day after Alibaba founder Jack Ma returned home from a year-long stay abroad, a move that dovetailed with Beijing's effort to spur growth in the private sector after two years of crackdown.

In the mainland China market, shares in information technology .CSIINT were up 2%, while semiconductors .CSIH30184 jumped 3.3% to lead gains amid China's call for tech self-reliance and a frenzy fuelled by the revolutionary computing technology ChatGPT.

"What China will currently do is to develop some self-sufficiency to support its own AI industry. I think this is one key investment focus the government is pushing," said Jing Ning, head of equities at FIL Fund Management (China) Company Limited.

Investors are also closely monitoring the China manufacturing purchasing managers' index (PMI) due on Friday for more evidence that the economic recovery is on track.