Hong Kong stocks rebound as Xi has upbeat message on markets, economy for US business leaders

China’s President Xi Jinping promises more policy support to improve the business environment in a meeting with an American delegation of corporate executives

Investors have an eye on corporate earnings with home appliances maker Haier Smart Home shares rising and ICBC retreating after declaring results

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Employees work on a washing machine production line at a factory for Chinese home appliances and consumer electronics company Haier in Qingdao, in eastern China’s Shandong province on February 18, 2024. Its shares jumped after the company posted better-than-estimated full-year results. Photo:AFP

Published: 10:48am, 28 Mar 2024Updated: 6:33pm, 28 Mar 2024

Hong Kong stocks rose on Thursday, helping the benchmark index end the month in positive territory, after President Xi Jinping’s meeting with US business leaders instilled optimism about investment flows into the world’s second largest economy.

The Hang Seng Index added 0.9 per cent to 16,541.42 at close, helping it finish with a 0.2 per cent gain in March. The city’s stock market is shut on Friday and on Monday next week for public holidays, although mainland China will be open for business. The Hang Seng Tech Index jumped 2.5 per cent and the Shanghai Composite Index added 0.6 per cent.

Stocks were also buoyed after a Post report on the central bank’s possible purchase of government bonds led to some speculation about quantitative easing. But investment banks including Morgan Stanley were quick to point out that massive easing measures were unlikely, and that the move was simply intended to improve open-market operations.

The focus on corporate earnings continued with home appliances maker Haier Smart Home jumping 8.2 per cent to HK$24.35 after posting better-than-estimated full-year results for 2023. China Life Insurance gained 5.2 per cent to HK$9.39 after analysts from investment banks including Citigroup said its 31 per cent profit decline for 2023 was smaller than expected. Smartphone maker Xiaomi added 1.2 per cent to HK$14.94 ahead of the announcement of the official price range and order placements of its first electric-vehicle model, due later today.

Xi pledged more policy support to improve its business environment in a meeting with more than a dozen US business executives from companies that included Blackstone, Pfizer and Qualcomm in Beijing on Wednesday, underscoring Beijing’s efforts to restore confidence and arrest a slide in foreign direct investment. He also dismissed the narratives that China’s economy was collapsing and that growth had peaked, vowing a greater scope for foreign businesses and deeper reforms.

“It is sending a message that China will be more proactive in striving for economic development goals and in its policy tone,” said Zhang Xia, an analyst at Great Wall Securities. “That may speed up the implementation of relevant policies on new-quality productive forces.”