A 380% surge in CanSino Biologics Inc. this year has made it the hottest stock in Hong Kong.
Shares of the Chinese vaccine maker have outperformed all other companies with a market capitalization exceeding $2 billion, according to data compiled by Bloomberg. The rally has accelerated in recent days, after the company said Health Canada approved its clinical trial application for a coronavirus vaccine. On Thursday, the stock jumped as much as 16% while setting up for an 11th straight day of gains.
It’s also the second-most overbought stock among the mid-cap and big-caps in Hong Kong after Tsim Sha Tsui Properties Ltd., with 14-day relative strength of around 89. A RSI measure that’s more than 70 indicates sentiment is overheated on a stock.
“No one knows how much CanSino is worth” said Castor Pang, head of research at Core Pacific-Yamaichi International Hong Kong. “People are making bets on the success of its vaccine, but the trial is just in stage two and there is possibility for it to fail.”
Other health-care stocks in Hong Kong are also doing well this year. AK Medical Holdings Ltd. is up 184% as of Thursday morning, Alibaba Health Information Technology Ltd. has jumped 130% and Ping An Healthcare and Technology Co. has gained 90%.