Hong Kong stocks extend winning streak, hit 8-month highs as mainland China returns from holidays

The Hang Seng Index hit its highest since September 4 and the Shanghai Composite Index advanced 0.9 per cent as trading resumed after a five-day local holiday

Goldman Sachs, BNP Paribas and UBS are more upbeat on Chinese stocks after the State Council issued a blueprint last month to prop up the US$9 trillion stock market

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Screens showing the index and stock prices outside Hong Kong Exchange Square (HKEX) in Central. Photo: Sun Yeung

Published: 10:53am, 6 May 2024Updated: 4:53pm, 6 May 2024

Hong Kong stocks extended gains towards an eight-month high after mainland traders returned from a five-day holiday to snap up local shares. Strong travel data and positive calls from a clutch of investment banks further lifted the mood.

The Hang Seng Index climbed 0.6 per cent to 18,578.30 at the close on Monday, the highest level since September 4, after intraday moves were limited within a tight range. The Tech Index jumped 0.9 per cent, while the Shanghai Composite Index advanced 1.2 per cent after a five-day local holiday.

Tencent jumped 1.6 per cent to HK$370.20, gaming firm NetEase added 2.3 per cent to HK$160.70, while EV maker Li Auto surged 6.1 per cent to HK$117.80. Online travel agency Trip.com advanced 4.2 per cent to HK$419.20 and drug maker Wuxi Biologics rallied 6.4 per cent to HK$14.86.

The city’s benchmark index had advanced for 10 straight days to register the longest winning streak since 2018, as China’s supportive policy stance and cheap valuations lured global investors. The rally helped register a gain of over 24 per cent from the January lows, with a rise of over 20 per cent widely defined as a bull market.

Mainland travellers at an open-air food stall (aka dai pai dong) in Central during the Labour Day ‘golden week’ break. Photo: Dickson Lee

Mainland investors scooped up over HK$5 billion worth of local shares on Monday, the biggest single-day purchase in over two weeks, according to Stock Connect data.