March 29 (Reuters) – Emerging market stocks rose on Wednesday after Alibaba’s shares lifted the Hong Kong bourse, with the internet giant’s revamp plan spurring hopes that clampdowns on China’s tech sector may be ending, while currencies softened against a steadying dollar.

The Hang Seng index .HSI rose nearly 2%, with shares of Alibaba Group Holding 9988.HK jumping about 15% after it said on Tuesday it was planning to split into six units and explore fund raisings or listings for most of them.

The decision was cheered by markets and perceived as a light at the end of the tunnel for many investors who had seen a wave of China’s regulatory crackdowns as a major cloud hanging over Beijing’s private sector.

“Alibaba’s planned super-split into six separate divisions has lifted China’s tech sector, helping a wave of positivity to wash over markets,” said Susannah Streeter, head of money and markets at Hargreaves Lansdown.

“The expectation is that other big Chinese tech giants could make similar moves, helping to potentially unlock more value, and aligning with authorities’ demands for greater competition as it ramps up its anti-trust drive.”

The MSCI’s index for emerging market stocks .MSCIEF rose 0.7% for the second straight day, while its currencies counterpart .MIEM00000CUS dipped about 0.1% against a steadying dollar.

South Africa’s rand ZAR= was flat, as investors awaited the South African Reserve Bank’s (SARB) interest rate decision on Thursday, with markets expecting a 25-basis-point increase.

Israel’s shekel ILS= lost 0.6% after a more than 1% jump the previous session in a relief rally sparked by Prime Minister Benjamin Netanyahu decision to pause his plan to overhaul Israel’s judiciary, which had sparked big protests.

Hungary’s forint EURHUF= extended its gains for a second day against the euro, after its central bank remained hawkish and shot down bets of easing its monetary cycle anytime soon.

Polish central banker Joanna Tyrowicz said monetary policy should remain restrictive until net inflation and wages converge to levels consistent with the inflation target. The zloty EURPLN= dipped 0.2% against the euro.

Peru’s sol PEN= will be in focus later in the day after prosecutors said they were investigating President Dina Boluarte and former president Pedro Castillo for allegedly laundering money as part of a criminal organization. Peru dollar bonds holding steady.

For GRAPHIC on emerging market FX performance in 2023, see http://tmsnrt.rs/2egbfVh

For GRAPHIC on MSCI emerging index performance in 2023, see https://tmsnrt.rs/2OusNdX

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(Reporting by Shreyashi Sanyal in Bengaluru; Editing by Robert Birsel)