Hong Kong stocks posted their best performance in two weeks yesterday as a rally on Wall Street and strong earnings from BOC (Hong Kong) and mid-size lender Wing Hang Bank overshadowed concerns about still high oil prices.
Enthusiasm for H shares continued for the second day following forecast-beating results from the likes of Maanshan Iron and Steel and Huadian Power. Investors were also more inclined to look for bargains after valuations dropped in recent weeks, analysts said.
'Buying came in as [the H-share index] fell below 4,000, but it is largely a technical rebound stimulated by the overnight gains on Wall Street,' one equity salesman said.
The H-share index jumped 2.52 per cent or 101.33 points to 4,123.08, marking its strongest performance in nearly five weeks. Twenty of the 37 index constituents posted gains of 3 per cent or more, only two fell.
The Hang Seng Index added 1.37 per cent or 168.13 points to close at 12,396.67.
A sharp increase in turnover to $12.74 billion from a daily average of $7.6 billion in the previous two days, was seen as a positive signal, although dealers said a fair amount of the volume was due to short-covering or day-trading activities.