Hong Kong stocks extend gains for a second straight day as investors take cue from rising US futures
- Index heavyweight Tencent Holdings climbs to two-year high
- Dow Jones futures point to an upbeat start in the US
Hong Kong and China stocks rose on Wednesday, as investors shrugged off concerns over surging Covid-19 infections in Beijing and focused on optimism in the US markets.
The Hang Seng Index swung between gains and losses before ending the day 0.6 per cent higher at 24,481.41, extending gains for a second day. The Shanghai Composite Index added 0.1 per cent to 2,935.87.
Investors were buoyed by the strength in the Dow Jones futures, which rose 0.6 per cent after opening in the afternoon. Wall Street remained hopeful over the US economic outlook after data pointed to a rebound in consumer spending in May.
“The Hong Kong market has become extremely sensitive to the Dow Jones futures since March, as investors are searching for short-term indicators to base their decisions upon before the economy recovers to its normal level,” said Castor Pang Wai-sun, head of research at Hong Kong-based brokerage Core Pacific-Yamaichi.
While worries over a new outbreak of coronavirus in China’s capital led to a sell-off on Monday, investors were still motivated to rush back into the market at a low point, he said.
Chinese authorities on Wednesday ordered residents to not leave Beijing unless they have tested negative for the virus in the past seven days, after the city reported 31 new locally transmitted infections. Zhejiang city in eastern China also reported a new case on Wednesday – a 36-year-old man who returned to his hometown after working at Xinfadi, a major wholesale food market in Beijing where many people were infected.