Hong Kong stocks rise as Asian markets approach new peak, Meituan paces new trio in December index rebalancing

Hang Seng Index advances after Asia-Pacific nations signed biggest trade pact in boost to post-pandemic outlook

Meituan, Budweiser and Anta climbed after being proposed for inclusion in index rebalancing from next month

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Stock bulls are charging hard on the back of trade optimism, nudging the broader Asia-Pacific markets closer to breaking its January 2018 peak. Photo: EPA-EFE

Published: 11:04am, 16 Nov 2020Updated: 5:12pm, 16 Nov 2020

Hong Kong and mainland China stocks started this week with gains, after 15 Asia-Pacific nations agreed to cooperate on reducing tariff and red tape in trade. Meituan led gains among three new index members in a proposed rebalancing exercise.

The Hang Seng Index advanced 0.9 per cent to 26,381.67 at the close of trading, halting a three-day slide. The Shanghai Composite Index climbed 1.1 per cent to 3,346.97, snapping up a four-day decline.

China and 14 other Asia-Pacific nations signed on Sunday the Regional Comprehensive Economic Partnership after eight years of negotiations. The deal is billed as the world biggest free-trade pact, covering about one-third of the world’s population and economy and excludes the US.

Markets across the region also chalked up substantial gains, with the Nikkei 225 leading the charge with 2.1 per cent advance, while South Korea’s Kospi Index rose 2 per cent. Today’s gains added to a powerful two-week surge this month, taking the MSCI Asia-Pacific Index within 2.2 points of breaking its previous record in January 2018.

Markets were also buoyed by China’s latest set of economic data for October. Industrial production grew by 6.9 per cent in October year on year, beating estimates, according to the statistics bureau on Monday. Retail sales grew by 4.3 per cent for a third straight month of expansion.

“Data from Asia has been impressive today, suggesting that RCEP is the icing on the cake of a region set to recover faster, and generally outperform, in 2021,” Jeffrey Halley, senior market analyst for Asia-Pacific at Oanda, said in a note to clients. The RCEP pact among a widely disparate group of nations, he said, “is an achievement in itself.”