Hong Kong stocks join global rally in best month since April 2015 as Lam’s policy address puts developers, airlines in play

Hang Seng Index has risen 10.6 per cent in November, the most since a 13 per cent surge in April 2015, as global markets rallied on recovery hopes

Carrie Lam’s policy address aided sentiment on developers, airlines and brokerages as city outlined new efforts to revive local economy

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The Hang Seng index reaches a nine-month high and is headed for the best month since April 2015 as recovery optimism sweeps global stocks to new records. Photo: Felix Wong

Published: 10:53am, 25 Nov 2020Updated: 5:29pm, 25 Nov 2020

Hong Kong stocks advanced for a fourth day to approach a nine-month high as optimism about a global recovery fed appetite for riskier assets. The government will remove stamp duty on commercial property and expand the cross-border stock trading link in efforts to revive the economy.

The Hang Seng Index climbed 0.3 per cent to 26,669.75 at the close on Wednesday. The gauge surged as much as 1.7 per cent to the highest since February 25 before paring gains as a technical indicator flashed an overbought signal. The Shanghai Composite Index dropped 1.2 per cent.

The 50-member local benchmark has risen 10.6 per cent so far in November, handing investors their best month since a 13 per cent surge in April 2015.

The rally reflects a bullish undertone across the Asia-Pacific region, with stock gauges from Japan to Australia recording gains. The Dow topped 30,000 points for the first time overnight while the S&P 500 Index also closed at a record. US President-elect Joe Biden’ began his transition into the White House, removing a drag on the market.

Globally, stock traders have started to price in a solid recovery outlook after three Covid-19 vaccine candidates made great progress this month during late-stage trials, even though new cases in the US and Europe are still on the rise. Hong Kong is facing a fourth wave of the pandemic, while sporadic new infections on the mainland have emerged in the biggest cities of Shanghai and Tianjin.

“Market sentiment remains underpinned by the trio of successful vaccine trials announced in recent weeks,” said Stephen Innes, a strategist at Axi. “Investors are simultaneously revelling in the drop in political existential risk premium now knowing the finishing touches on the US election process will not devolve in mobocracy as Joe Biden can start his formal transition to the White House.”

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