Hong Kong stocks, led by Tencent, reach highest level since December 2007
Shares of Chinese internet giant Tencent rise for eighth session in a row
Hong Kong stocks made the biggest one-day gain in a month and rose to a fresh 10-year high on Tuesday, lifted by tech, property and energy companies.
The Hang Seng Index rallied 1.4 per cent, or 397.54 points, to 28,994.34, the highest level since December 2007. The Hang Seng China Enterprises Index, known as the H-shares index, gained 1.1 per cent, or 120.89 points, to 11,645.53. Turnover stood at HK$116 billion (US$14.8 billion), up 4 per cent from Monday.
“Market sentiment was very good today, driven mainly by technology shares such as Tencent Holdings and AAC Technologies,” said Kingston Lin King-ham, director of securities brokerage AMTD.
“These particularly robust stocks sent the Hang Seng Index above the 28,900 level, and the index stands a chance of touching 30,000 points in the short-term.”
Flotations of new economy companies such as e-book site China Literature, and gaming equipment maker Razer, have also lifted market sentiment, Lin said.
Tencent rose for the eighth straight session to another all-time high of HK$391, up 3.7 per cent, contributing 122 points to the Hang Seng Index.
Tencent’s China Literature unit, announced earlier on Tuesday it had priced its HK$8.3 billion initial public offering at the top end of an indicative range at HK$55. Expected to start trading on Wednesday, it has locked in investor capital of more than HK$520 billion, the second largest in Hong Kong history.
Investors have high hopes on Tencent’s third-quarter results due on November 15.
“Investors are all awaiting Tencent’s earnings, and if the earnings miss expectations, the Hang Seng Index may consolidate further in the second half of November,” said Lin.
AAC Technologies, an acoustics component supplier for Apple’s iPhones, rose 1.8 per cent to HK$156.5. It was boosted by record values for Apple stock overnight in the US because of strong demand for its new iPhone X. AAC, expected to announce results this week, jumped more than 10 per cent on Monday.
Energy stocks advanced for a second day. Sinopec jumped 3.7 per cent, PetroChina added 2.6 per cent, and offshore oil producer CNOOC advanced 1.1 per cent.
Oil prices surged to their highest since July 2015 on Monday as Saudi Arabia’s crown prince continued to strengthen his power base in the kingdom with an ongoing and unprecedented crackdown on corruption. The news had spurred concerns that Middle Eastern money might be pulled out of global financial markets.
China Evergrande, the mainland’s largest property developer by sales, jumped 9.4 per cent, after it raised another 60 billion yuan (US$9 billion) by selling a stake in its Hengda Real Estate unit. It was the third stake sale by the developer in the unit this year, bringing the total amount raised to 129.5 billion yuan.
Chinese car manufacturer Geely Automobile surged 5.7 per cent to HK$26.15. The company announced October car sales increased 30 per cent year on year, while total sales for the first 10 months of 2017 grew 72 per cent.
Mainland Chinese markets rose for a second day. The Shanghai Composite Index added 0.8 per cent to 3,413.57. The CSI 300, which tracks large companies listed in Shanghai and Shenzhen, increased 0.8 per cent to 4,054.25. The Shenzhen Composite Index gained 0.7 per cent to 2,012.72, while the start-up board index ChiNext rose 0.5 per cent to 1,859.07.
In Asia-Pacific markets, Tokyo’s Nikkei 225 gained 1.7 per cent to 22,937.60, the highest close since 1992. Sydney’s S&P/ASX 200 advanced 1 per cent to 6,014.3, its best since 2008. South Korea’s Kospi edged down 0.2 per cent to 2,545.44.
All three major US indices closed higher on Monday, with the Dow Jones Industrial Average finishing 0.04 per cent up at 23,548.42 and the S&P 500 tacking on 0.13 per cent to 2,591.13. Meanwhile, the Nasdaq Composite gained 0.3 per cent to 6,786.44.