Hong Kong stocks rose for a third day, the longest winning streak in three weeks, on optimism China’s recovery from Covid-19 lockdowns will gain stronger momentum.
The Hang Seng Index climbed 1.9 per cent to 21,559.59 at the close of Tuesday trading. The Hang Seng Tech Index advanced 2.2 per cent, while the Shanghai Composite Index fell 0.3 per cent.
Developers including China Resources Land and Country Garden rallied for a second day after more mainland cities rolled out supportive policies to revive the housing market. Sands China and Galaxy Entertainment recouped Monday’s losses. Alibaba Group Holding led tech winners.
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Hong Kong’s stock benchmark has risen 17 per cent from a six-year low on March 15, after Covid-19 cases in Beijing and Shanghai declined and key economic indicators improved in May. Investors are betting China’s top policymakers will do more to boost growth, including lowering loan rates on home purchases and injecting more liquidity by cutting reserve-requirement ratio.
“The rebound in Hong Kong stocks can last for a while,” said Wang Yi, an analyst at Great Wall Securities. “The pro-growth measures are now working and more are on the way. The internet sector is pivotal to stabilising growth and employment, and there will be more positive policy signals on the sector.”
Country Garden gained 1.7 per cent to HK$4.70 and China Resources Land added 1.3 per cent to HK$34.60. Country Garden Services jumped 2.5 per cent to HK$33. Alibaba Group Holding, owner of the Post, added 1.3 per cent to HK$105.80, and Meituan rose 0.9 per cent to HK$201.20.
Sands China rose 1 per cent to HK$14.72, recouping part of a 2.2 per cent loss on Monday. Galaxy Entertainment advanced 1.6 per cent to HK$41.05 after falling 1 per cent on Monday. The casino operators slipped on Monday after Macau reported new Covid-19 infections for the first time in eight months.
Tencent Holdings added 2.8 per cent to HK$381 after it reduced a stake in Koolearn Technology to 1.6 per cent from 9 per cent for HK$719.7 million. Koolearn gained 3.1 per cent to HK$17.50, bringing the rally to seven-fold over the past week on the back of a foray into live-streaming e-commerce.
Elsewhere, CLP tumbled 7.1 per cent to HK$67.40 as the worst performer on the Hang Seng Index. The setback was due to a significant fair value loss from forward contracts of EnergyAustralia, Hong Kong’s sole power supplier said in an exchange filing late Monday.
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