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People walk through the piazza in front of the headquarters of Hong Kong Exchanges and Clearing Limited (HKEX), Central. Photo: Elson LI
BusinessMarkets

Hong Kong stocks edge up, driven by corporate earnings but caution prevails as monetary policy moves eyed

  • Earnings announcements from sportswear company Li Ning and telecoms giant China Unicom triggers sharp gains in their shares
  • PBOC keeps benchmark rates steady as expected and investors await its next move after the central bank chief said China has ‘ample monetary policy space’
Hong Kong stock market
Jiaxing Li
Jiaxing Li
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Hong Kong stocks posted cautious gains after earnings announcements from sportswear company Li Ning and telecoms giant China Unicom showed operational improvements, but investors remain cautious awaiting the next move from China’s central bank which kept its benchmark lending rates unchanged at a monthly fixing.

The Hang Seng Index added 0.1 per cent to 16,543.07 at the closing of Wednesday trading, after retreating 1.2 per cent on Tuesday. The Tech Index gained 0.7 per cent, while the Shanghai Composite Index climbed 0.6 per cent.

Sportswear brand Li Ning surged 4.9 per cent to HK$21.30 after reporting a net profit of 3.2 billion (US$44 million), and its peer Anta Sports gained 2.3 per cent to HK$79.50.

“We saw stabilising inventory conditions, better than expected online retail sales in the fourth quarter, in-line full year 2023 earnings, significant amortisations in the second half and increased dividend and buy-backs,” said analysts at Jefferies after Li Ning’s earnings announcement.

China Unicom climbed 2.5 per cent to HK$5.71 after reporting a record income for last year, with HSBC analysts saying “the results presentation indicated broad progress in developing new business areas in IOT, private 5G networks, cloud services and infrastructure, and communications”.

Limiting gains, China Resources Power slid 3.9 per cent to HK$17.92 after net income missed estimates. New World Development lost 2 per cent to HK$8.81, leading losses among local developers.

Caution prevailed after the People’s Bank of China (PBOC) kept benchmark rates unchanged, following its decision to maintain the rate on one-year medium-term lending facility at 2.5 per cent last week. Investors have been awaiting central bank relief after PBOC Governor Pan Gongsheng said China has “ample monetary policy space” and a “deep toolbox” to accomplish its goals.

Three newly listed stocks made a stellar debut on Wednesday. Cinderson Technology surged 82 per cent from its IPO price to 35 yuan in Shanghai, Shenzhen Jdd Tech New Material advanced 90 per cent to 105.97 yuan in Shenzhen and drug maker Qyuns Therapeutics jumped 24 per cent to HK$24.50 in Hong Kong.

Key Asian stock markets were mostly higher. South Korea’s Kospi Index advanced 1.3 per cent while Australia’s S&P/ASX 200 declined 0.1 per cent. Japan’s market is closed for a local holiday.

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