The Hang Seng Index gained 1.4 per cent to 16,173.79 at 11.10am local time, adding to the 4.2 per cent rebound last week. The Tech Index added 1.3 per cent, while the Shanghai Composite Index added 0.2 per cent.
The China Securities Regulatory Commission said it will bar key shareholders from lending their stock under lock-up period from Monday. The decision, announced over the weekend, came after China’s central bank surprisingly cut banks’ reserve ratio to shore up market sentiment.
“The market is still in a rebound phase driven by sentiment recovery,” Kevin Liu, strategist at CICC said in a report on Sunday. “A true trend reversal requires more targeted policy catalysts”, he added.
China bars investors from lending securities during restricted periods
China bars investors from lending securities during restricted periods
Hong Kong’s stock market recovered last week from a 15-month low to halt a three-week slump. The benchmark index has declined 5.4 per cent so far this month, heading for the worst January since the 6.7 per cent slide in the first month of 2020.
Sentiment is likely to be cautious before more potentially weak economic data this week. Chinese manufacturing is likely to remain in contractionary territory for a fourth month in January, according to economists tracked by Bloomberg. Industrial profits fell 2.3 per cent in 2023, the second straight year of decline, a government report last week showed.
Elsewhere, the Federal Reserve is expected to hold its key rate unchanged at its first policy meeting of the year later this week, according to odds calculated from Fed fund futures contracts compiled by CME Group.
Major key Asian markets traded higher. South Korea’s Kospi advanced by 1.3 per cent and Australia’s S&P/ASX 200 added 0.3 per cent, while Japan’s Nikkei 225 added 0.9 per cent.