Chinese Shares Soar As Tencent Passes Facebook

Asian shares staged one helluva rally overnight, shaking off jitters about China’s renewed efforts to rein in a labyrinthine shadow banking complex that’s so littered with duration mismatch and cross-holdings that trying to untangle it is probably an exercise in abject futility.

New rules for AMPs dented sentiment in Chinese shares on Monday, but thanks to a characteristic afternoon rally, Chinese markets ended higher. On Tuesday, it was off to the races. The SHCOMP rose 0.55% but the CSI 300 was the standout, rising the most in nearly three months:

China

Shares soared in Hong Kong, as the Hang Seng jumped nearly 2% to its highest since November 2007.

HangSeng

Hong Kong-listed Chinese big-caps were up dramatically:

HangSengChinaEI

Tencent is the story. It has now blown past Facebook in market value, making it the first Chinese tech name to join the ranks of the world’s five largest companies. It is now valued at some $523 billion. As you can see, it’s had a good year:

Tencent

Also worth noting, it looks to me like Hang Seng futures exploded in after-hours trading before snapping back down to some semblance of reality.

Futues

So there you go. If U.S. shares needed an excuse to rally, they’ve got it.

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