Hong Kong stocks complete longest winning run since January as Alibaba, Cathay Pacific, banks rally, market prepares for Ant IPO

Hang Seng Index gained 0.9 per cent after its steepest decline since September 21, keeping benchmark up for a third week

Alibaba rebounded 3.2 per cent, after biggest fall in three months, banks recouped losses, travel bubble buoyed Cathay Pacific

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Stock prices are reflected on the screen outside a brokerage in Shanghai, China. Photo: Handout

Published: 11:06am, 16 Oct 2020Updated: 5:09pm, 25 Oct 2020

Hong Kong stocks advanced on Friday, lifting the benchmark index to its longest winning run in nine months. Alibaba Group Holding paced winners on optimism its affiliate Ant Group will press on with its jumbo initial public offering despite recent hurdles. A travel bubble plan buoyed carrier Cathay Pacific.

The Hang Seng Index rose 0.9 per cent to 24,386.79, brining the weekly gain to 1.1 per cent. The gauge has risen for three straight weeks, a stretch not seen since the week ending January 17. The benchmark recovered today after a 2.1 per cent sell-off on Thursday, the steepest pullback since September 21.

The Shanghai Composite Index gained 0.1 per cent to 3,336.36, ending two consecutive days of declines with a weekly gain of 2 per cent.

President Xi Jinping’s visit to Shenzhen buoyed Hong Kong and China markets earlier in the week, propelling the market capitalisation of the Shanghai and Shenzhen exchanges past US$10 trillion for the first time since 2015. Both markets retreated after the US government mulled imposing sanctions on Ant Group and other financial institutions on Wednesday.

Alibaba, the owner of this newspaper, jumped 3.2 per cent to HK$294. The stock, which had a 5.2 per cent weight in the HSI, tumbled 4.3 per cent on Thursday or the most in three months, after Reuters reported that the US was proposing to add its affiliate Ant Group to a trade blacklist.

“There is strong support [for Hang Seng Index] at around 24,000 points,” said Kenny Wen, wealth management strategist at Everbright Sun Hung Kai. “And yes yesterday’s correction was little bit too much for Alibaba as well as HSI, we see investors re-entering the market today.”