Hong Kong stocks halt 5-day slide on bets China to cut rates to spur growth

The Hang Seng Index rose 0.6 per cent to 16,316.84 at 10.55am local time, halting a cumulative 4.8 per cent decline in preceding five trading days. The Tech Index climbed 0.4 per cent from a 13-month low, while the Shanghai Composite Index added 0.3 per cent.

HSBC gained 1.8 per cent to HK$63.75, Alibaba Group added 0.3 per cent to HK$70.55 and Baidu strengthened 1.8 per cent to HK$115. EV maker BYD added 2.7 per cent to HK$210.40 and rival Li Auto rose 1.3 per cent to HK$133.30. Online travel services group Trip.com jumped 3 per cent to HK$298.60 and JD Health rose 3.2 per cent to HK$33.95.

“Beijing has continued to introduce policy stimulus measures due to an increasing likelihood of another growth dip,” analysts at Nomura said in a note on Monday. The central bank “is quite likely to cut its benchmark lending rates” next week, they added.

UBS bets on China stock market rebound in 2024 with earnings, property recovery

The central bank last reduced the one-year medium-term lending facility in a surprise move in August last year as growth momentum eased, after delivering a cut in June 2023 and August 2022.

Foreign fund managers have sold a net 9.9 billion yuan (US$1.4 billion) of onshore-listed stocks so far this month, adding to a record sell-off over the preceding five months, according to Stock Connect data.

Elsewhere, three Chinese companies debuted in Hong Kong on Tuesday. Concord Healthcare, a producer of medical and healthcare devices, sank 27 per cent to HK$10.44, while Shenzhen-based building contractor Zhongshen Jianye tumbled 20 per cent to HK$0.80. Changjiu Holdings, which runs automotive dealerships, rose 6.5 per cent to HK$6.34.

The trio raised a combined gross proceeds of HK$992.3 million (US$127 million) from their stock offerings, with Concord and Changjiu pricing them at the lower end of their target range.

Other key Asian markets rallied. South Korea’s Kospi gained 0.2 per cent, while Australia’s S&P/ASX 200jumped 1.1 per cent and Japan’s Nikkei 225 surged 1.7 per cent.