Hong Kong stocks rise for third day as China pledges monetary easing, top banks cut deposit rates to aid recovery

Hong Kong stocks rose for a third day after China’s biggest lenders cut deposit rates in a move to protect margins and spur consumption in the struggling economy. The central bank also pledged to keep monetary easing to spur growth.

The Hang Seng Index gained 0.4 per cent to 16,688.38 at 10.14am local time, paring the loss for the week to 0.7 per cent. A three-day winning run was last seen on November 6. The Tech Index added 0.3 per cent and the Shanghai Composite Index dropped 0.3 per cent.

China’s top lender ICBC gained 0.8 per cent to HK$3.71, while peer Construction Bank added 0.2 per cent to HK$4.52 and HSBC rose 0.5 per cent to HK$61.55. Alibaba Group advanced 0.8 per cent to HK$73.95 and e-commerce JD.com climbed 3.3 per cent to HK$108.80. Baidu jumped 2.6 per cent to HK$115 and Tencent rose 0.8 per cent to HK$315.

The People’s Bank of China will maintain “reasonable” credit growth to create sound financial conditions to sustain economic recovery, it said in a statement on Thursday. Meanwhile, ICBC, Construction Bank and their peers lowered deposit rates from Friday, according to state-run China Central Television.

China to see healthy and sustainable growth in the year ahead: PBOC chief

The Hang Seng Index remains 16 per cent below the starting point this year, making it the worst performer among major world benchmarks. Global funds stayed bearish on China’s outlook, even as valuation at 5.6 times earnings multiple is the cheapest among them, according to Bloomberg data.

Four companies made their debuts in Hong Kong today. Gold producer Persistence Resources was unchanged at HK$0.55, while drug maker HighTide Therapeutics rallied 5.2 per cent to HK$12.10. Logistics provider FAR International added 0.2 per cent to HK$1.12 and tea producer Pu’er Lancang Ancient Tea gained 0.2 per cent to HK$10.72.

In Shanghai, Hsino Tower Group, which makes steel towers for power lines, surged 218 per cent to 5.41 yuan on its first day of trading.

Major Asian markets were mixed. Japan’s Nikkei 225 climbed 0.3 per cent and Australia’s S&P/ASX 200 added 0.1 per cent, while South Korea’s Kospi was little changed.

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