Hong Kong stocks end at record high

HONG KONG: Hong Kong stocks posted their highest ever close yesterday, boosted by a flood of cash from mainland Chinese investors and a worldwide surge in optimism about the global economy.

The Hang Seng Index (HSI) leapt 1.81%, or 565.88 points, to close at 31,904.75 – topping its best ever finish seen on Oct 30, 2007.

The HSI is now within spitting distance of its alltime record of 31,958.41 and analysts widely expect it to break that barrier soon as markets across the planet rally on economic optimism, and hopes for strong corporate profits following US President Donald Trump’s huge tax cuts last month.

Spurred on by successive records on Wall Street, Hong Kong’s market surged more than a third in 2017 and has started the new year in blistering form, having risen a record 14 straight days until a small loss on Monday.

Everbright Sun Hung Kai analyst Kenny Wen said he saw the HSI breaking 34,000 by the end of the year thanks to a weaker US dollar and expectations for better company earnings.

Despite the latest surge Raymond Cheng, Hong Kong-based head of Asia equity strategy at JPMorgan’s private bank unit, said the gains were to be expected.

“Look at the overall scheme of things: we have had how many years of downtrend? Almost eight or nine years,” he told Bloomberg News. “Yes, last year we had a big rally, but it’s well justified in my mind by the earnings pick-up.” – AFP