Alibaba, Baidu, Longfor lift Hong Kong stocks to five-month high as China pledges fiscal boost to virus-hit economy
- Finance Minister Liu Kun pledged to hand the virus-hit economy a fiscal spending boost amid drive to reopen borders
- Fed minutes from December meeting awaited for clues on US policy tightening pace in 2023
The Hang Seng Index jumped 3.2 per cent to 20,793.11 at the close of Wednesday trading, logging the best gain since December 8. The Tech Index surged 4.6 per cent while the Shanghai Composite Index added 0.2 per cent.
Alibaba Group Holding soared 8.7 per cent to HK$96.40, Tencent Holdings rose 4.6 per cent to HK$361 and Baidu advanced 8.2 per cent to HK$124.20.
Longfor surged 11.6 per cent to HK$26.95 and peer Country Garden jumped 7.1 per cent to HK$2.88, leading a rally among mainland developers amid speculation Chinese lenders will lend further financial support to “systemically important” developers to staunch a market slump.
“China’s policies are now becoming more favourable to Covid and property sectors,” Wang Xueheng, analyst at Guosen Securities said in a note on Wednesday. Markets will maintain the robust momentum in the first quarter, while infections and rate hikes may cause only limited pullback, Wang added.
Mainland investors bought HK$4.4 billion worth of stocks in Hong Kong on Wednesday, in addition to HK$4.2 billion on Tuesday, according to Stock Connect data. They scooped up a total of HK$138.6 billion in the final quarter of 2022.
The Federal Reserve will release the minutes of its policy meeting in December tomorrow. They may provide insight into the next move later this month, following the growing consensus that the central bank may be ready to temper its tightening pace as inflation cools.
Asian markets were mixed on Wednesday. Stocks in South Korea and Australia jumped 1.6 to 1.7 per cent, while the Nikkei 225 in Japan retreated 1.5 per cent.