Hang Seng Index

Hong Kong’s main stock index closes Year of the Monkey up 21pc

PUBLISHED : Friday, 27 January, 2017, 1:43pm
UPDATED : Sunday, 29 January, 2017, 10:11pm

Hong Kong’s Hang Seng Index ended the Year of the Monkey up 21.11 per cent after a quiet last day of trading before the Lunar New Year.

Stocks opened lower, edging down in the first few minutes of trading on Friday, and ended the half-day session down 0.06 per cent at 23,360.78 points ahead of holidays to celebrate the Year of the Rooster.

The close represented an increase of about 4,000 points compared with February 6, 2016, the last day of trading for the Year of the Goat. The H-share index rose 21.73 per cent to 9,804.05 points on Friday.

“That’s not bad. We experienced a very volatile market [for the year], taking into account a lot of unexpected news,” said Louis Tse Ming-kwong, a director of VC Brokerage in Hong Kong.

Mainland Chinese markets were closed on Friday for a public holiday. The Shanghai Composite Index finished the Year of the Monkey up 14.3 per cent at 3,159.17 points when the market closed on Thursday. The Shenzhen Composite Index rose 9.5 per cent to 1,917.32 points for the year while the CSI 300 Index gained 14.3 per cent to 3,387.96 points.

“The outlook in the short term will be good. The [Hong Kong] stock market in the first quarter could hit the 24,000-point level,” Tse said.

“The market will be bolstered by the sentiment in US markets and anticipated positive earnings results from blue chips such as HSBC Holdings and Tencent Holdings.”

Tencent, China’s second-largest technology company, closed down 0.3 per cent at HK$204.40 on Friday but gained 42 per cent in the Year of the Monkey.

HSBC, following a rise for four consecutive days, inched up 0.07 per cent to HK$66.75on the fifth day.

“In the second and third quarters, we may see a correction. We are not sure if the Donald Trump magic can last too long,” Tse said.

In the second and third quarters, we may see a correction. We are not sure if the Donald Trump magic can last too long
Louis Tse, director, VC Brokerage

Ben Kwong Man-bun, executive director of KGI Asia, said the stock market would remain very volatile, citing interest rate movements and the global economic outlook as uncertainties.

He expects a rise in Hong Kong stocks on the first day of trading in the Year of the Rooster next Wednesday.

Bolstered by Trump’s economic policies, the Dow Jones Industrial Average broke 20,000 points for the first time on Wednesday and extended those gains on Thursday. The S&P 500 Index and the Nasdaq Composite Index are also sitting on record highs.

While the energy sector was among the best performers over the past year, Tse is confident about the property sector going forward as developers have reaped strong sales revenues from new project launches.

The technology sector would be positive after Alibaba Group Holding posted better-than-expected third-quarter results, he said. Alibaba owns the South China Morning Post.

Hong Kong’s stock market will resume trading on February 1 while mainland Chinese markets will reopen on February 3.