The Hang Seng Index edged up 0.4 per cent to 19,640.60 at 3pm local time, the highest level since July 31 last year. The Tech Index gained 0.6 per cent while the Shanghai Composite Index jumped 0.6 per cent.
Electric vehicle maker BYD jumped 1.8 per cent to HK$226.60 and peer Li Auto advanced 4 per cent to HK$99.75. E-commerce platform JD.com gained 2.8 per cent to HK$137.90 and gaming firm NetEase rose 1.6 per cent to HK$165.40. Sportswear maker Li Ning jumped 8.4 per cent to HK$23.85 while Macau casino operator Galaxy Entertainment rose 4.5 per cent to HK$41.70.
“We believe Beijing is headed in the right direction with regard to ending the epic housing crisis,” Nomura economists including Ting Lu said in a note on Monday. Still, markets would need to exercise more patience as the cleaning up process will be challenging, they added.
Ahead of Monday’s gains, the city’s benchmark index had advanced for four straight weeks, the best winning streak since the opening month of 2023, which added some US$350 billion in market capitalisation to the city’s exchange, according to Bloomberg data.
Still, some investors say caution is warranted after the recent stellar gains, as any potential upside will be determined by interest rate movements, corporate earnings and any subsequent fiscal steps taken by the government.
“For policies to be effective, especially in terms of fundamentals, the overall intensity and speed of implementation are crucial” analysts at CICC said in a note over the weekend. “Given the current uncertainty, we are reluctant to completely abandon the barbell strategy and fully shift to cyclical sectors.”
Other key Asian markets also traded higher. Japan’s Nikkei 225 climbed 0.7 per cent, while South Korea’s Kospi and Australia’s S&P/ASX 200 both gained 0.6 per cent.