Geely Automobile Holdings’ shares rose to their highest intraday level since June 2018 after a report of a collaboration with Germany’s Daimler AG.
The Chinese car maker’s shares in Hong Kong rose sharply Wednesday morning, surging 8.5% to HK$22.90 at midday.
The jump came after a Reuters report that said Daimler will cooperate with Geely to build next-generation combustion engines for use in hybrid vehicles.
Geely, whose owner holds a near 10% stake in the German car maker, declined to comment on the program.
Stocks of Chinese car makers were broadly higher on Wednesday. Analysts have been generally bullish on car sales in China in 2021.
Following a auto-sector slump lasting three and half years, a five-year replacement cycle for passenger vehicles in China is on the horizon, Citi said. The U.S. bank maintains Geely and peer BYD Co. as its top sector picks.
BYD shares rose 2.4% at midday while Dongfeng Motor rose 4.3%.
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