Hong Kong and China shares rebound, but extend weekly losing streaks

Hong Kong shares rebounded from multi-month lows on Friday, led by high yielding stocks including the property sector, even though they ended the week lower for a fifth time in a row.

Mainland Chinese markets also bounced off six-month lows as strength in technology and pharmaceutical stocks countered losses in the banking and energy sectors. Volume was weak as money rates stayed tight.

The CSI300 of the leading Shanghai and Shenzhen A-share listings rose 0.7 per cent after ending on Thursday at its lowest since December. The Shanghai Composite Index gained 0.6 per cent. This week, they shed 2.7 and 2.2 per cent, respectively.

The Hang Seng Index rose 0.4 per cent to 20,969.1 after closing on Thursday at its lowest since October. The China Enterprises Index of the top Chinese listings reversed midday gains to slip 0.2 per cent.

A twelfth straight loss sank the H-share index to its most technically oversold level since August 2011 as it slumped 5 per cent this week in its worst weekly loss in more than a year. The Hang Seng benchmark lost 2.8 per cent.

It was the fifth-straight weekly loss for the two benchmarks.

Shanghai volume on Friday neared this year lows as China’s short-term funding costs jumped to their highest levels since early last year. A hardline stance by the central bank against injecting liquidity has made the market reverse expectations of monetary easing, traders said.