Hong Kong stocks jump to 7-week high on signs of thawing China-US ties while Beijing moves to stimulate economy
- Signs of thawing relations between the US and China are giving fresh hopes to investors while Beijing unveils more measures to revive economy
- Gains limited by official reports showing China’s key economic data trailed market consensus in October
The Hang Seng Index climbed 4.1 per cent to 18,343.12 at the close, its highest level since September 21. The Tech Index surged 7.3 per cent, and the Shanghai Composite Index added 1.6 per cent.
“The easing of the tensions between China and the US has alleviated concerns among overseas investors, which will help to repair stock valuations,” said Cheng Yu, a fund manager at HSBC Jintrust Fund Management in Shanghai. “We are seeing a turnaround in corporate earnings” after a slew of policy-easing measures, he added.
Separately, China’s banking regulator said on Monday the nation’s developers will be allowed to use some of their presale funds in escrow accounts to keep their operations afloat, adding to measures to tackle a liquidity crunch that has been plaguing the industry over the past two years.
The Hang Seng Index has risen 25 per cent from an October low, pushing blue-chip stocks into bull-market territory as it became the top performer among global benchmark stock indices, according to Bloomberg data. The rally contributed to a US$665 billion recovery in the city’s market capitalisation.
Property management firm Country Garden Services surged 18 per cent to HK$19.74, and China Vanke added 2.5 per cent to HK$14.18. Longfor Group gained 1.7 per cent to HK$21.55 while China Overseas Land and Investment rose 1.3 per cent to HK$20.30.
Elsewhere, traders shrugged off reports today showing China’s key October economic data trailing analysts’ estimates. Industrial production increased 5 per cent from a year earlier, falling short of the 5.3 per cent consensus estimate. Retail sales fell 0.5 per cent, missing the forecast of a 0.7 per cent gain.
New Huo Technology Holdings rebounded 0.3 per cent to HK$3.53, halting a 14 per cent from the previous day. The digital assets firm has US$18.1 million of cryptocurrencies deposited with FTX, and warned it may not get its money back from the cryptocurrency exchange which has collapsed in the world’s largest crypto-related bankruptcy in history, it said in an exchange filing on Monday.
Other major Asian markets were mixed. Japan’s Nikkei 225 added 0.1 per cent per cent and South Korea’s Kospi closed 0.2 per cent higher, while Australia’s S&P/ASX 200 lost 0.1 per cent.