Hong Kong stocks rallied more than 9% today after a pledge by Chinese authorities to provide much-needed support to beaten-down markets that has slashed the valuations of some of the country's biggest firms.
The official Xinhua news agency said authorities would maintain capital market stability and adopt measures to handle risks for troubled property developers.
The policy would respond to the need to boost the economy in the first quarter and new loans will grow appropriately, it said, citing a meeting chaired by Vice Premier Liu He.
The news lit a fire under Hong Kong's Hang Seng Index, where mainland Chinese tech firms had been reeling from a sell-off this year fuelled by a government crackdown on the sector.
The Hang Seng Index rocketed 1,672 (9.08%) to close at 20,087.
Traders pounced on the report to snap up beaten-down firms that have been hit by concerns about regulatory crackdowns by Chinese and US authorities.
The Hang Seng tech Index soared a record 20% higher, while Alibaba, Tencent and NetEase were up around 20%, JD.com was up almost 30% and Meituan around 25%.
Troubled property giant China Evergrande jumped about 10%.
The news will provide some much-needed relief to investors in the city after they suffered an eye-watering sell-off sparked by concerns over the Ukraine war and prospects for a series of interest rate hikes by the US Federal Reserve.
News that the southern Chinese tech hub of Shenzhen had been put into lockdown to fight a Covid-19 outbreak compounded the crisis for the sector, while fears about possible US sanctions if China were to help Russia in its war with Ukraine also helped fuel the selling.
The rally has helped pare some of the huge losses that the firms have endured so far this year. Alibaba and JD.com are still down around 20% since the end of December, while XD is less than half its value back then.
But while the rally was much-needed, there are fears that the selling has not finished yet.
"Personally I fear that the crisis the market faces is not just about China, it's a global issue, and not just something that regulators can solve with this," Wang Mingxuan of Quant Technology Investment said.
"The calm this brings is just the calm before the storm," he added.
