Hong Kong and mainland China stocks gained along with major Asia-Pacific markets after Federal Reserve officials allayed concerns about inflation outlook. Xiaomi Corp jumped to a three-month high after getting back into FTSE Russell indexes.
The Hang Seng Index advanced 1.8 per cent to 28,910.86, reaching its highest level since April 29. The Shanghai Composite added 2.4 per cent to a three-month high, after a bullish forecast by Guotai Junan Securities and amid speedier vaccination efforts.
“Market sentiment has improved, and we’re seeing a bit of a breakthrough in the Hang Seng Index,” said Stanley Chan, director of research at Emperor Securities.
Do you have questions about the biggest topics and trends from around the world? Get the answers with SCMP Knowledge, our new platform of curated content with explainers, FAQs, analyses and infographics brought to you by our award-winning team.
Smartphone maker Xiaomi rose 4.1 per cent to HK$27.75, the highest level since February 23. FTSE Russell announced on Monday that it would reinstate Xiaomi into its global indexes in two tranches from June 7 and June 21. The company is also due to report its annual results on Wednesday with consensus calling for a 34 per cent jump to 1.74 billion yuan (US$271.6 million).
Federal Reserve officials on Monday reiterated they expected inflation pressures to be temporary. Dovish comments from speakers including St Louis Fed president James Bullard, suggest any policy tightening is not happening any time soon, Reuters reported.
Other notable winners include WuXi Biologics, which surged 5.9 per cent to HK$116.30 while Tencent gained 4.2 per cent to HK$610. Hong Kong Exchanges and Clearing gained 5.4 per cent to HK$474.60, the most in four months. The bourse operator will keep a steady course connecting China with global markets, chief executive Nicolas Aguzin said on Tuesday.
Short video-sharing app operator Kuaishou tumbled 11.5 per cent to HK$205.60 to a record low since its listing in February, after its net loss widened to 57.8 billion yuan (US$9.1 billion) in the first quarter from 30.5 billion yuan a year earlier. Nomura lowered its target price to HK$273 from HK$333 with a buy rating.
Mainland China markets got a boost amid reports of vaccination progress drive, Chan added. China passed the 500 million-dose vaccination milestone mark on Sunday in its plan to jab 40 per cent of its population by June 30.
Financial stocks were among the best performers, with a gauge of brokerages gaining 3.9 per cent, according to Eastmoney.com. China International Capital Corporation soared by the upper trading limit of 10 per cent to 59.71 yuan.
Shenzhen SEG was little changed at 5.44 yuan after earlier losing as much as 1.5 per cent. The company which still owns 39,900 square metres of space in the SEG Plaza, has fallen 13 per cent since May 14. Tenants reported the building’s wobble last Tuesday and authorities have called for a probe.
Major markets in Asia-Pacific gained by 0.7 to 1 per cent. The S&P 500 gained 1 per cent in overnight trading, while the Nasdaq Composite rose 1.4 per cent.
Five companies debuted on Tuesday. Chinese property management firm New Hope Service Holdings edged up 0.5 per cent to HK$3.82 from its issue price of HK$3.80 in Hong Kong. Solar pump manufacturer Zhejiang Taifu rose 434 per cent to 49.98 yuan in Shenzhen, while Henan BCCY Environmental Energy soared 291 per cent to 35.90 yuan.
In Shanghai, natural gas product manufacturer Jiangxi Jovo Energy gained 24.5 per cent to 43.05 yuan and Zhejiang Provincial New Energy Investment increased 44 per cent to 5.05 yuan from their listing prices.
More from South China Morning Post:
This article Hong Kong stocks jump as Xiaomi returns to FTSE Russell indexes while Fed tempers inflation concerns first appeared on South China Morning Post