Hong Kong and China shares gained after China’s central bank injected liquidity into the financial markets to support banks on Monday. The Hang Seng Index gained 0.7 per cent to 25,347.34 on Monday after two consecutive sessions of losses, while the Shanghai Composite Index rose 2.3 per cent. The People’s Bank of China added 700 billion yuan (US$101 billion) of one-year funding through its medium-term-lending facility, while keeping the interest rates unchanged at 2.95 per cent, it said in a statement. This more than offset the 400 billion yuan in loans due on Monday, and another 150 billion yuan maturing on August 26, Bloomberg reported. “The PBOC [has injected] money into the market, that is the main driver for the stock market today,” said Louis Tse Ming-kwong, managing director of VC Asset Management. In China, stocks related to the banking sector rose 3.7 per cent, according to a gauge compiled by Xuangubao.com. China Merchants Securities and China Life Insurance both soared to the upper trading limit of 10 per cent on the Shanghai bourse. Investors’ reaction to index compiler Hang Seng Indexes company’s upcoming revamp was mixed. On Friday, it was announced that Alibaba Group Holding, mobile phone maker Xiaomi and China’s largest drugs development and manufacturing services provider WuXi Biologics will be included in the benchmark Hang Seng Index from September 7. Xiaomi rose 5.6 per cent to HK$16.20, while WuXi Biologics increased 4.7 per cent to HK$169.00. Alibaba fell 1.6 per cent to HK$242.80. The three firms replace snack maker Want Want China, developer Sino Land, and China Shenhua Energy on the gauge, indicating a shift from traditional industries to new economy and biotech firms. Jimmy Lai’s Next Digital was a ‘salted fish’ that lived twice, as shares soared, giving his stock a fleeting second lease on life Want Want China fell 3.2 per cent, Sino Land fell 3.8 per cent while China Shenhua Energy rose 1.2 per cent. Li Ning, the eponymous sportswear brand founded by China’s best-known Olympic gymnast, gained 3.5 per cent, as Jefferies reiterated its “buy” rating on the stock. The company reported on Friday that its net income fell 14 per cent to 683.3 million yuan (US$98 million) in the first six months of 2020, a smaller drop than expected amid the pandemic. “We believe the 1H20 results open a new chapter for the long-term story of Li Ning (LN), which may now involve more market share expansion,” the report said. “We see LN as having superior channel health, a stronger relationship with distributors and an evolving multi-line strategy to take market share from its Chinese peers.” Geely Auto dropped 6.4 per cent after reporting net profits slid 42.7 per cent for the first six months of the year. Shares in Kweichow Moutai, the world’s most valuable liquor distiller and one of the most heavily traded stocks on the Stock Connect, rose 1.75 per cent to 1,690 yuan. Meanwhile, five IPOs started trading on the mainland markets. In Shanghai, GSP Automotive Group Wenzhou rose 44 per cent to 22.42 yuan from its listing price of 15.57 yuan. Bonree Data Technology shot up 84 per cent to 121.11 yuan from its listing price of 65.82 yuan. Shanghai CEO Environmental Protection surged 40.9 per cent to 65.12 yuan from its listing price of 46.22 yuan. InfoVision Optoelectronics Kunshan surged 707.4 per cent to 9.85 yuan from its listing price of 1.22 yuan. In Shenzhen, Dongguan Aohai Technology gained 44 per cent to 38.71 yuan from its listing price of 26.88 yuan. Asia markets slipped. Japan’s Nikkei 225 dipped 0.8 per cent after the country’s economy suffered a record contraction in the second quarter. Australia’s S&P/ASX 200 fell 0.8 per cent, while South Korea’s Kospi slid 1.2 per cent.