Hong Kong stocks advance on China housing policy support measures, US rate-cut bets
- Hong Kong stocks have been on a tear in recent sessions as China ramped up policy support for its battered property sector and amid speculation of a dividend tax relief
- Broader gains in Asia were spurred after core inflation data in the US inspired bets the Fed will deliver the cut in its policy interest rate in September and December
The Hang Seng Index advanced 1.6 per cent to close at 19,376.53, its highest since August 7. The Hang Seng Tech Index climbed 0.8 per cent and the Shanghai Composite Index added 0.1 per cent.
Hong Kong stocks have been on a tear in recent sessions after China ramped up policy support for the battered housing market and following speculations about dividend tax relief, making the Hang Seng Index the best performing benchmark globally last month.
In the latest effort to stem the downturn and reduce inventories, the city of Hangzhou said that it would buy existing homes and rent them out as affordable housing and Hefei, the capital city of east Anhui province, would give homebuyers subsidies equivalent to 2 per cent of the values of purchases homes.
“If the measures are implemented, we view it as an important step towards resolving developers’ liquidity issue and restoring homebuyers’ confident in the property market,” said Raymond Cheng, analyst at CGS International in a note. “We stay sector neutral as many private developers still face liquidity problems and are in the process of restructuring.”
Sector gains were led by Longfor Group Holdings whose stocks soared 11 per cent to HK$13.80 and peer China Overseas Land and Development which rallied 4.6 per cent to HK$15.82.
