For all its global popularity, Nintendo Co. has had relatively limited business in China. Now, a deal with Tencent Holdings Ltd. has investors excited at the prospect of the Japanese company’s Switch console and smartphone games taking off in one of the world’s biggest game markets.

Nintendo shares shot up 7.1% to a nine-year high Tuesday on word that one of China’s most popular videogames—Tencent’s “Honor of Kings”—will be available on the Switch this winter. The game is called “Arena of Valor” in Europe, where it was introduced...