The Hang Seng Index has ended a buoyant week just 4.47 per cent below where it was on September 11, making it one of the quickest global markets to rebound after the terrorist attacks in the United States.
Analysts put the performance down to Hong Kong's exposure to mainland and financial stocks, as China has been seen as relatively isolated from the ensuing fallout and market leader HSBC Holdings is a safe haven relative to banks with greater US exposure.
'I think obviously the China telecommunications shares are a safe haven. And even HSBC should be much stronger than other global banks,' BNP Prime Peregrine Hong Kong and China research head Adrian Ngan said.
The blue-chip banks and China Mobile accounted for 78 per cent of yesterday's gains, which saw the Hang Seng Index jump 3.64 per cent, or 349.91 points, to 9,950.7. The benchmark is up 11.37 per cent for the week.
It has staged a steady recovery since reaching 8,934.2 on Friday last week. The index has a low weighting in the sectors that have been hardest-hit - airlines, insurance and tourism.
'We got beat up so hard for no reason. On valuation grounds, the market is not expensive but after the September 11 incident, sentiment tanked,' UBS head of Hong Kong strategy Andrew Look said.