Hong Kong and China stocks rose for the first time this week, as traders assessed prospects of global growth and the fallout from a resurgence in the coronavirus epidemic in Europe.
The Hang Seng Index added 0.1 per cent, or 25.66 points, to 23,742.51 at the close on Wednesday after changing direction at least 10 times. The benchmark snapped a 3 per cent decline over the previous two days. The mainland’s Shanghai Composite Index rose 0.2 per cent to 3,279.71.
HSBC Holdings rebounded from its lowest level in 25 years and Joy Spreader Interactive Technology, one of Hong Kong’s most sought-after initial public offerings, dropped below the offer price on debut.
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Most equity gauges in Asia retreated except Australia, after the Federal Reserve chairman Jerome Powell said that the US economy has a long way to go before it fully recovers from the damage of Covid-19 and will need more support. Meanwhile, the UK imposed new lockdown measures that are likely to last six months, with Prime Minister Boris Johnson urging people to work from home if possible. In overnight trading, US stocks reversed an earlier sell-off to end higher as bargain hunters piled into retail and tech stocks on the dip, taking advantage of a rout on Monday.
“After the Monday meltdown across most global equities, there is a temporary sense of calm enveloping the global stock markets,” said Stephen Innes, a strategist at AxiCorp. “Although the central banks can do more, equity markets have likely reached their multiple policy deluges’ saturation point.”
In a further sign of frayed relations between the US and China, President Donald Trump and his Chinese counterpart Xi Jinping clashed during a virtual United Nations General Assembly, bickering over issues from ocean pollution to the coronavirus pandemic.
HSBC rose 0.2 per cent to HK$28.75, reversing an intraday loss of as much as 4.2 per cent. The stock slid to its lowest close since May 1995 on Tuesday, on concern that it will face sanctions from China for assisting the US in investigations into Huawei Technologies. It has lost 53 per cent this year on slumping profits amid the Covid-19 pandemic.
Sino Biopharmaceutical and Geely Automobile Holdings were the biggest gainers on the Hang Seng Index, rising at least 2.2 per cent.
Joy Spreader dropped 6.3 per cent from its offer price to HK$2.70, making the Wan Chai-based company the first in recent history to decline on debut. The retail portion of its IPO was more than 1,600 times oversubscribed, the third most popular offering this year.
On the mainland, two IPOs debuted on the Shenzhen exchange and both rose by the daily limit. Beijing ZZNode Technologies, whose businesses range from software development to systems integration, surged by 44 per cent from the offer price to 33.70 yuan, while Xuchang KETOP Testing Research Institute, which offers industrial testing services, also rose by the same magnitude to 43.80 yuan.
Huayi Brothers Media sank 4.1 per cent to 5.09 yuan in Shenzhen after two owners of the filmmaker said they plan to sell no more than a 3 per cent stake in the company to repay stock pledges.
More from South China Morning Post:
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This article Hong Kong and China stocks snap two-day run of losses after changing direction at least 10 times first appeared on South China Morning Post