Hong Kong stocks breach yet another 10-year high

Hang Seng Index closes at 28,490.83, up 0.6pc, fuelled by red-hot technology and property stocks

PUBLISHED : Tuesday, 10 October, 2017, 9:29am
UPDATED : Tuesday, 10 October, 2017, 10:57pm

Hong Kong stocks closed on another ten-year record high on Tuesday, fuelled by red-hot technology and property stocks.

The Hang Seng Index pared earlier losses to edge up 0.1 per cent or 26.96 points at 28,353.55 by the midday break and swung up 177 points to peak at 28,503 in the afternoon before closing at 28,490.83, up 164 points or 0.6 per cent.

Hong Kong equities slipped from last week’s record highs on Monday as investors chose to take profits. But share prices bounced back with strong momentum, provided by technology and property stocks.

HSBC emerged as the biggest gainer of the day, edging up 1.4 per cent to HK$78.6 (US$10.07). Its shares once breached HK$79.65, which was a record high in three years.

The strong gain came after the lender said it repurchased 1.0263 million shares in London on Monday at a price range of £7.54 (HK$77.276) to £7.59 per share.

Goldman Sachs raised the target price of HSBC in Hong Kong to HK$87 from HK$83 due to higher forecasts in UK mortgage loan growth and stronger Hong Kong net interest margins.

Shares in Hong Kong developers also gained across the board as the city waited for Chief Executive Carrie Lam Cheng Yuet-ngor’s maiden policy address on Wednesday.

New World Developement jumped 5.1 per cent to HK$12.04, marking a four-year record high. Sun Hung Kai Properties edged up 1.6 per cent.

Louis Tse Ming-kwong, a director of VC Brokerage in Hong Kong, said developers seemed optimistic about Lam’s policy address, which is leading to “quite a bit of buying” in the sector.

“Property players are looking to convert farmland into developments, which is looking to increase their asset values,” he said.

He said Lam’s pending address was looking favourable for the property sector.

Technology stocks also scored a win on Tuesday, led by Tencent which closed up 0.6 per cent.

In addition to the strong performance from the blue chip stocks, Ali Health and HengTen Networks turned heads with the former gaining 9.7 per cent and the latter gaining 8.9 per cent.

Outside of Hong Kong, the mainland market is eyeing the release of the minutes from the most recent Federal Reserve meeting, also due on Wednesday, which may show support for another interest rate increase by the end of the year.

Apple-concept stocks were among gainers. Tongda Group surged 3.76 per cent to HK$2.21 after it said it planned to spin-off in a separate listing of its notebook and tablet casings manufacturing business.

AAC Technologies gained 2.44 per cent to HK$134.2.

In the mainland, the Shanghai Composite Index rose 0.255 per cent to 3,382.99 while the CSI 300 gained 0.19 per cent to 3,889.86 .

The Shenzhen Composite Index edged up 0.78 per cent to 2,030.18 while ChiNext rose 1.46 per cent to 1,917.46.

All three major US indices retreated in light trading on Monday after setting closing records every day last week. The Dow Jones Industrial Average finished 0.1 per cent lower at 22,761.07, the S&P 500 slipped 0.2 per cent to 2,544.73 and the Nasdaq Composite was also down 0.2 per cent at 6,579.73.