South China Morning Post
Advertisement
Advertisement
Hong Kong stock market
Get more with myNEWS
A personalised news feed of stories that matter to you
Learn more
A pedestrian walks past an electronic billboard displaying the Hang Seng Index in Central on October 24, 2022. Photo: SCMP / Sam Tsang
BusinessChina Business

Hong Kong stocks jump for a second day as typhoon warning forces exchange to halt trading

  • The Hang Seng Index closed 2.4 per cent higher on Wednesday, with the afternoon trading session cancelled because of a typhoon alert
  • Investors ignore the prospect of further rate increases by the Federal Reserve
Hong Kong stock market
Jiaxing Li
Jiaxing Li
Why you can trust SCMP
Hong Kong stocks surged on Wednesday after trading was halted in the afternoon because of a typhoon alert. Traders continued to assess China’s reopening speculation while shrugging off the prospect of further interest-rate increases by the Federal Reserve.
The Hang Seng Index closed 2.4 per cent higher at 15,827.17, extending the 5.2 per cent gain on Tuesday. The Hong Kong stock exchange suspended trading at 1.55pm, after the observatory issued the No 8 typhoon warning as Severe Tropical Storm Nalgae neared. The Hang Seng Tech Index gained 2.7 per cent, while the Shanghai Composite Index added 1 per cent.

All but four of the 73 index members advanced. Alibaba Group Holding rose 2 per cent to HK$67.40, Tencent Holdings gained 1.4 per cent to HK$230.60 and BYD added 4 per cent to HK$190.90. Macau casino operators surged, with Sands China soaring 12 per cent to HK$17.12 and Galaxy Entertainment adding 6.7 per cent to HK$41.60. The surge followed a report that more Chinese cities are adopting inhaled vaccines, prompting speculation that China will relax its zero-Covid policy.

“These are technical rebounds as the market has fallen,” said Kenny Ng Lai-yin, a strategist at Everbright Securities International. He attributed the rally to rumours about China’s reopening and that the market was awaiting concrete developments.

“The rebounds this year have often turned out to be short-lived, and the performance is likely to remain weak in the short term as rate hikes will continue to put pressure on the market,” he said.

Beijing remains “ fully focused” on economic growth and is committed to making Hong Kong an even stronger international financial centre to help achieve that goal, China’s top financial regulators said during the Global Financial Leaders’ Investment Summit on Wednesday.

More than 200 international and regional leaders from around 120 global financial institutions are now in the city to attend the summit. “Hong Kong is back” and banks should “get in front” of the queue for business, Chief Executive John Lee Ka-chiu said in his opening speech.

John Lee urges global banks to ‘get in front’ as Hong Kong roars back

Adding to the positive sentiment, Swiss bank Julius Baer said it will expand its Hong Kong office to use the city as a hub for wealth management and family office businesses in China and other Asian markets, according to its global chief. Citigroup also plans to expand its wealth management centre in the city.

Elsewhere, the Fed is set to extend its policy lift-off with another 75-basis-point increase later tonight, after a US employment report on Tuesday showed the labour market is still strong.

The Hong Kong Monetary Authority (HKMA) is expected to follow suit and raise its base rate by the same amount, taking it to the highest since 2008, increasing the pressure on the local economy. The city’s gross domestic product shrank by 4.5 per cent in the third quarter, as banks raised their prime rate, choking demand.

Asian stocks were flat. The Nikkei 225 in Japan and Kospi in South Korea were little changed, while the benchmark index in Australia rose 0.1 per cent.

Post