Hong Kong stocks jumped by the most in three weeks on signs Covid-19 outbreaks in mainland China are easing, fuelling hopes for a wider reopening of the locked-down economy. Policymakers also ramped up efforts to shore up growth. The Hang Seng Index advanced 1.7 per cent to 20,276.17 at the close of Thursday trading. The Tech Index added 2.2 per cent while the Shanghai Composite Index gained 0.6 per cent to extend a rebound from a two-year low. China Merchants Bank surged 5.7 per cent to HK$46.95, the most in two months. Pork processor WH Group climbed 4.1 per cent to HK$5.60 and Alibaba Group, the owner of this newspaper, advanced 4.4 per cent to HK$88.25. JD.com increased 4.4 per cent to HK$229.60 Sentiment improved as Covid-19 infections dropped in some major mainland cities, with new cases in Shanghai falling to a three-week low on Wednesday. Infections in Beijing were brought under control after mass testing covering most areas in the capital. Authorities lifted a two-month lockdown in the northeastern city of Changchun from Thursday. Still, the Hang Seng Index has lost 7.8 per cent this month, heading for a third month of setback abetted by the fallout from China’s tough zero-Covid strategy. New Covid-19 cases in Shanghai fell for the fifth straight day , according to city officials, and prompting authorities to work on plans for restarting manufacturing, public transport, and retail services in the financial hub. The People’s Bank of China last week offered a 23-point guidance on shoring up funding and support for businesses battered by the pandemic, while refraining from unleashing its full policy-easing firepower with a token cut in reserve-requirement ratio this year. “We believe China is ready to act and likely to step up policy easing should a sharper economic slowdown occur,” Kai Kong Chay, senior portfolio manager for Greater China equities at Manulife Investment Management, said in a report. “ While near-term market sentiment has been mixed, we view the latest measures as signs that China is on track to maintain its economic course.” Calls for more aggressive stimulus have been mounting among investors, as the lockdown in Shanghai and other cities undermined the official growth target of 5.5 per cent for this year. Traders will turn to a Politburo meeting later this week for more insight into how top leaders will calibrate policies to navigate the world’s second-largest economy through the macro headwinds. Stock investors turn to Politburo for surprises as meeting gains significance amid headwinds from China lockdowns Premier Li Keqiang urged coordination among different state departments to ensure smooth logistics to reduce supply-chain disruption, according to a statement after a weekly State Council meeting on Wednesday. The government will also boost support of smaller enterprises hit by the pandemic. The rally in China Merchants Bank helped claw back almost half of the US$35 billion rout following the removal and corruption probe of its former top executive Tian Huiyu last week. XPeng Motors rose 2.5 per cent to HK$96.20 after the electric-vehicle maker said it secured a credit line of 7.5 billion yuan (US$1.14 billion) from Agricultural Bank of China to strengthen its in-house research and development capabilities.