NewHong Kong and China markets ring out October with solid gains
October marked a major reversal for regional markets after sharp losses during the summer months
Hong Kong and mainland stock markets ended in positive territory in October, reversing some of the hefty losses suffered over the summer, as government-led stimulus and policy easing by the People’s Bank of China helped to shore up sentiment.
Hong Kong’s flagship Hang Seng Index ended the month 8.6 per cent higher at 22,640 points, its first monthly gain since April, while the Shanghai Composite added 10.8 per cent to 3,382 points, its first monthly advance since June. The Shenzhen Composite Index rose 17.4 per cent, extending its rise to a second straight month after a fractional gain in September. The mainland-tracking H-share index was up 10.5 per cent for the month.
Uncertainties over the US interest rate outlook were a factor weighing on the regional share markets, according to analysts.
“The market turned cautious ahead of the Fed meeting [on October 28] so liquidity dried up and we couldn’t advance further,” Louis Tse, director of VC Brokerage, said.
One analyst noted the tendency for mainland stocks to do well in the autumn in what appears to be a seasonal pattern influenced by government policy.
“At the end of every summer, the government initiated pro-growth policies to achieve its full-year GDP target,” UBS strategist Wenjie Lu said in a note. “This year seems similar to us, with policy banks, the Ministry of Finance and local governments speeding up the funding and construction of infrastructure projects.”