The Hang Seng Index surged 3.9 per cent to 18,079.00 at the closing of Wednesday trading, the best gain since March 1 and lifting the benchmark to a one-month high. The Tech Index jumped 4.4 per cent, while the Shanghai Composite Index rose 0.6 per cent.
All but one of the 80 index members advanced. Alibaba Group rallied 5.1 per cent to HK$83.30, food delivery platform Meituan advanced 4.6 per cent to HK$113.30, and search engine operator Baidu jumped 5 per cent to HK$109. Tencent jumped 4.8 per cent to HK$322.60 and e-commerce platform JD.com surged 6.4 per cent to HK$105.90 before their quarterly results, due after the close of trading.
HSBC gained 2.7 per cent to HK$59.90 and Sun Hung Kai Properties strengthened 3.7 per cent to HK$80.75, leading local banks and developers higher. A US government report on Tuesday showed inflation slowed more than expected, underpinning bets that the Federal Reserve’s aggressive rate-increase cycle is over.
Meanwhile, China’s central bank injected 1.45 trillion yuan (US$200 billion) into the banking system through its midterm lending facility, indicating more accommodative policy from Beijing.
“We continue to see value in Hong Kong and China stocks, and favour cyclical recovery plays that are beaten down on valuations and possess relatively better fundamentals,” Nomura analysts including Chetan Seth said in a note on Wednesday.
Wednesday’s advance has pushed the Hang Seng Index 5.7 per cent higher this month after a three-month losing streak. Still, the benchmark index has slumped nearly 10 per cent this year to rank as the worst performer among major global indices due to China’s uncertain economic recovery.
Asian stocks advanced. Japan’s Nikkei 225 added 2.5 per cent, while South Korea’s Kospi jumped 2.2 per cent and Australia’s S&P/ASX 200 climbed 1.4 per cent.