Hong Kong stocks revisit pre-pandemic high as Covid-19 vaccine hopes fuel US, Asian markets to records

Hang Seng Index rose to the highest level since March 5, spurred on by US drug maker Moderna’s news on the efficacy for its vaccine jab in trials

Stock benchmarks in the US and Asia were setting records overnight as vaccine progress lifts hopes for reopening of economies

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The Hang Seng Index approaches the March 5 high in a rally fuelled by encouraging progress in Covid-19 vaccine trials. Photo: Edmond So

Published: 11:03am, 17 Nov 2020Updated: 11:17am, 10 Dec 2020

Hong Kong stocks rose to the highest level in more than eight months as recent progress in late-stage trials for a Covid-19 cure prompted traders to chase US and Asian stocks to new heights.

The Hang Seng Index closed 0.1 per cent higher to 26,415.09, the highest level since March 5. The increase raised the index to within 353 points or 1.33 per cent of erasing the slump induced by the coronavirus outbreak. Some 32 index members rose while 17 declined.

US biotech firm Moderna said on Monday that its experimental vaccine was 94.5 per cent effective in preventing Covid-19. The results followed the 90 per cent efficacy recorded by a vaccine candidate developed by Pfizer and its German partner BioNtech, announced last week.

“The HSI and US stocks are at a high level now, so investors are hesitating whether they will continue to rally,” said Gordon Tsui, chairman of Hantec Pacific and president of Hong Kong Securities Association.

US stocks rallied overnight, with the Dow Jones Industrial Average surged to a record high. The MSCI Asia-Pacific Index rose for an 11th straight day through Monday to an all-time high.

“Investors are looking further ahead in the pandemic development into 2021, instead of focusing on the very challenging outbreak that is taking place in the US and Europe now,” Tai Hui, chief Asia market strategist at JPMorgan Asset Management in Hong Kong, said in a note to clients. “Overall, we still think the global economy is in an early phase of the recovery cycle and hence we are constructive on risk assets.”