Alibaba and Tencent rebound as Chinese tech stocks rise on stimulus

Chinese technology stocks, including beaten names like Alibaba, rallied this week to reach highs not seen in more than a year after China's central bank announced measures to boost the world's second-largest economy.

Hong Kong's Hang Seng Tech Index, which includes most major Chinese technology stocks, closed up nearly 6% at its highest level since early August 2023. The index is up 20% this week.

Alibaba closed above $100 per share in the US on Thursday for the first time since August last year, after rising 10% during the session. On Friday, the company's Hong Kong-listed shares hit their highest closing price since February 2023, rising nearly 5% to 102.50 Hong Kong dollars. Shares of the Hong Kong e-commerce giant are up around 18% this week.

Tencentthe owner of China's largest messaging app WeChat and one of the world's largest gaming companies, closed down nearly 2% at 437.80 Hong Kong dollars per share. This is the company's highest close in more than two and a half years and comes after Tencent shares rose around 49% this year on a recovery in its core gaming business.

Huge food supplier Meituan Meanwhile, the session ended 8% higher at HK$164.60 per share, the company's highest closing price since February last year.

The market rally comes after the People's Bank of China this week announced a cut in the amount of cash banks must hold on hand. The central bank outlined plans to further support the struggling property market, including extending measures for two years and cutting interest rates on existing mortgages.

These measures were imposed in the hope of boosting the Chinese economy. Before the cuts, investors were cautious about Chinese technology stocks like Alibaba and Meituan, which are sensitive to the Chinese economy and consumer.

However, well-known investors began to strikee a bullish tone for Chinese stocks. Billionaire hedge fund founder David Tepper told CNBC on Thursday that he has bought more Chinese stocks, including names like Alibaba and Baidu, following the Federal Reserve's rate cut this month.

Other names including JD.com And Baidu Share increases were also recorded this week.

Despite the recent rebound, Chinese tech stocks remain well off their 2021 all-time highs.

– CNBC's Evelyn Cheng contributed to this report.