Hong Kong stocks close higher after CSRC reveals support measures
Hong Kong stocks closed higher on Monday, the first trading day after China’s top securities regulator on Friday revealed five measures to support the capital market in the Hong Kong Special Administrative Region (HKSAR).
Industry observers said that the new measures will expand the channels for capital flows and improve market liquidity and stability in Hong Kong.
Hong Kong stocks are likely to receive capital inflows, given that they are at historic lows, Yang Delong, chief economist at Shenzhen-based First Seafront Fund, told the Global Times on Monday.
“The further downside for Hong Kong stocks is extremely limited, meaning that the potential for appreciation is prominent among global markets,” Yang said.
The measures had a rapid impact as Hong Kong stocks closed higher on Monday, with the benchmark Hang Seng Index up 1.77 percent to 16,511.69 points.
The Hang Seng China Enterprises Index was up by 1.47 percent to 5,831.26 points, and the Hang Seng Tech Index rose 1.78 percent to close at 3,336.35 points.
Shares of Tencent, one of the top 10 weighted stocks of the Hang Seng Tech Index, rose 5.46 percent to HK$320.4 ($40.9) on Monday. Other top 10 weighted stocks also rose, with Meituan up 5.56 percent and Kuaishou up 1.92 percent.
The Hang Seng Tech Index represents the 30 largest technology companies listed in Hong Kong that have high business exposure to technology themes and pass the index’s screening criteria.
The China Securities Regulatory Commission (CSRC) on Friday announced five measures that will be implemented jointly with the HKSAR to further strengthen the Stock Connect – aiming to promote the coordinated development of the capital markets of both the Chinese mainland and the HKSAR – and support the city in strengthening its position as an international financial center.
With the support of the five measures, southbound funds will continue to flow into the Hong Kong stock market, further strengthening the position of the city’s stock market among global capital markets and enhancing the price stability and rationality of the Hong Kong stock market, analysts said.