SHANGHAI: China stocks rose on Monday for a fourth straight session, with the country’s 30-year treasury yield hitting a record low amid heightened expectations that Beijing will unveil fresh economic stimulus.
Hong Kong shares, which are more sensitive to the US rate-cutting cycle that started last week, hit a three-month high, before surrendering gains in afternoon trading.
Both China’s blue-chip CSI 300 index and the Shanghai Composite Index rose 0.4%. The Hang Seng Index ended flat.
US rate cuts will herald further easing by global central banks, potentially benefiting Chinese exports this year, said Yang Chao, analyst at Galaxy Securities.
“China’s A-shares are relatively cheap by history standards,” and are worthy buying for long-term investors.
Hong Kong stocks will likely benefit more from US rate cuts, as the market is more affected by global money flows than China, where regulators keep tight capital controls, said brokerage CICC.
The yield on China’s benchmark 30-year government bond fell to a record low of 2.13%, after China’s central bank supplied 14-day cash to its banking system at a lower interest rate.
Expectations of fresh stimulus were also fuelled by announcement that China’s top financial regulators including the central bank will jointly hold a press conference on Tuesday.
Coal, energy and banking stocks lead gains in China.
The smaller Shenzhen index ended up 0.15% and the start-up board ChiNext Composite index was weaker by 0.397%.
In Hong Kong, the sub-index of the Hang Seng tracking energy shares rose 1.1%, while the IT sector rose 0.41%, the financial sector ended 0.45% higher and the property sector dipped 0.33%.
Around the region, MSCI’s Asia ex-Japan stock index was firmer by 0.29% while Japan’s Nikkei index was up 1.53%.
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