The Hang Seng Index jumped 1.7 per cent to close at 16,438.09 on Wednesday, rebounding from the previous day’s 2.6 per cent fall. The Tech Index gained 2.7 per cent while the Shanghai Composite Index lost 0.3 per cent.
“Sentiment is slowly improving as earnings surprises are now, in contrast to 2023, rewarded generously,” Herald van der Linde, head of Asian equity strategy at HSBC, said in a note. China’s earnings season is key, possibly more so than the “two sessions” political meetings which often focus on the big picture and lack details that stock analysts look for, he added.
Central bank governor Pan Gongsheng said China has ample room for monetary policy, and can afford to make further cuts to its reserve requirement ratio. While the new CSRC chairman Wu Qing promised further protection for investors in order to restore their confidence.
Despite today’s gains, the Hang Seng Index is down 0.9 per cent for the week after surging 6.6 per cent in February. The lack of reforms and the absence of clear strategies during the top legislative meeting to restore the trend growth of the economy have piled pressure on local stocks, according to Redmond Wong, chief China strategist at Saxo Markets.
Other key Asian markets were little changed. South Korea’s Kospi Index lost 0.3 per cent while Australia’s S&P/ASX 200 added 0.1 per cent. Japan’s Nikkie 225 was little changed.