Hong Kong, China markets rise as jump in August money supply underscores growth, giving confidence to bargain hunters
- Hong Kong’s benchmark Hang Seng Index rose by 0.7 per cent, while the China Enterprises Index rose by 0.6 per cent
- Major benchmarks on the Shanghai and Shenzhen exchanges closed higher
The stock markets of Hong Kong and China ended Friday higher, as traders shrugged aside the overnight rout on Wall Street to hunt for bargains among stocks that have lagged the technology boom of recent months, while China’s growth in money supply underscored the country’s economic recovery.
Hong Kong’s benchmark Hang Seng Index closed 0.8 per cent higher at 24,503.31, closing the past five trading days lower for the second straight week of declines in September. The China Enterprises Index that tracks the performance of China-domiciled companies in Hong Kong advanced by 0.7 per cent to 9,752.50
“Some investors are buying stocks at a low price or betting on a rebound,” said Daniel So, analyst at CMB International. “More traders will enter the market after the declines of the past two weeks as the excessive buying of technology stocks has almost finished.”
China‘s money supply jumped in August, illustrating the economic expansion in the country that had bolstered the rally in the equity market.
Some 1.28 trillion yuan (US$187 billion) of new loans were added in August, exceeding the market projection of 1.25 trillion yuan. Aggregate social financing reached 3.58 trillion yuan, much higher than the market expectation of 2.585 trillion yuan. Broad money supply rose 10.4 per cent year over year, according to monetary data disclosed by the central bank.
Gaming and technology stocks rallied in Hong Kong, bolstered by bargain hunters aiming to snap up stocks they consider undervalued. Sands China, which operates one of the biggest casinos in Macau, rose by 4.5 per cent to HK$33.75.