Tencent, JD.com power Hong Kong stocks amid signs China is preparing to exit zero-Covid as Goldman predicts reopening boost
- China is making preparation to further ease zero-Covid curbs, though a reopening may be months away, Goldman Sachs says in reports
- Mainland China funds ramped up buying on Monday, after stocks posted their biggest rallies last week on reopening speculation
The Hang Seng Index rose 2.7 per cent to 16,595.91 at the close of Monday trading as 70 of its 73 blue-chip constituents advanced. The Tech Index rallied 4.1 per cent while the Shanghai Composite Index gained 0.2 per cent.
Tencent jumped 2.9 per cent to HK$245.40, JD.com surged 3.1 per cent HK$177 and Meituan climbed 2.3 per cent to HK$153. HSBC leapt 3.7 per cent to HK$43 and bourse operator Hong Kong Exchanges and Clearing rose 5.4 per cent to HK$259.60. Country Garden led property developers higher with an 11 per cent rise to HK$1.41.
Mainland funds bought HK$4.9 billion (US$675 million) of stocks in Hong Kong on Monday, according to Stock Connect data. They were net buyers of US$4.3 billion worth of shares last week, the largest inflow into the city over the past 12 months.
“The market thinks the worst is over,” said Gary Ng, a senior economist at Natixis Corporate and Investment Bank in Hong Kong. “The sentiment has already improved a lot since last week after the policy speculations. People now have more faith in a speedy reopening, despite not knowing when it will finally come.”
The benchmark in Hong Kong surged 8.7 per cent last week, the most since October 2011, contributing to a US$266 billion rebound in equity value in the broader market.
