Hong Kong stocks surge over 5pc as Chinese funds flood the market
Record turnover of HK$252.4 billion after gap between A and H shares widened during Easter and Ching Ming break, luring bargain hunters
The Hong Kong stock market opened high on Thursday morning with a 5 per cent rise in the Hang Seng Index a day after it was swamped by a wave of mainland Chinese money that helped drive trading to a record HK$252.4 billion turnover on the way to a seven-year high for local shares.
The Hang Seng Index reached a high of 27,922.67 and retreated to 27,658.94 at 10am, a staggering rise of 1,422.08 points, or 5.42%.
Bargain hunting swept the market on Wednesday after the valuation gap between mainland-listed A shares and H shares – the Hong Kong-listed stocks of mainland companies – widened by 4.47 per cent while the local exchange was closed for Easter and Ching Ming.
Aside from the record turnover, yesterday saw the daily quota for Hong Kong-bound investments under the market tie-up between the city and Shanghai filled for the first time.
Mainland investors piled into the city’s stocks via the through train programme, with turnover hitting a record HK$21 billion for southbound trade. The previous high was last Thursday, at HK$4.8 billion, pointing to new-found interest in the scheme from mainland investors, who had previously barely used their allocated daily quota of 10.5 billion yuan (HK$13.3 billion). The southbound flow was also boosted by a regulatory approval last week for mainland fund houses to invest in Hong Kong stocks.
The Hang Seng Index surged 3.8 per cent to close at 26,236.86, the highest close since May 6, 2008. The H-share index jumped 5.8 per cent to 13,396.59, with the southbound quota running out at about 2pm.