Hong Kong stocks soared for a sixth day in a row, hitting a 22-month high as the China market frenzy rolled on, while BlackRock said more stimulus from Beijing could be coming.
The Hang Seng Index jumped 4.8 per cent to 22,151.09 as of 10.55am local time, the highest level since January 2023. The Hang Seng Tech Index surged 7.5 per cent. A gauge tracking Chinese stocks listed in the US rallied 5.5 per cent overnight. Markets in mainland China are closed this week for a holiday.
All but seven out of the 82 Hang Seng Index members jumped. Food delivery platform Meituan surged 12.3 per cent to HK$193.20, e-commerce platform JD.com jumped 11.5 per cent to HK$186.30 and search engine operator Baidu rallied 9.9 per cent to HK$116.10, leading gains among heavyweights.
Hong Kong’s benchmark index has surged 21 per cent since Beijing surprised the market with a stimulus package last week, restoring more than US$770 billion in market valuation to local stocks, according to Bloomberg data. Wall Street banks are now scrambling to raise their targets on key China indices after being squeezed by short bets.
“We see room to turn modestly overweight [on] Chinese stocks in the near term” given their near-record discount to developed-market shares even with the recent surge, strategists at BlackRock Investment Institute including Wei Li said in note on Tuesday. More fiscal stimulus may be coming and that will prompt investors to step in, they added.
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