China stocks extend gains fuelled by monetary easing; Hong Kong slips

SHANGHAI: China stocks extended gains on Wednesday as the reserve requirement ratio cut kept investor sentiment buoyed, with consumer staples and chipmakers leading the rise.

The CSI300 index rose 1.1% to 4,976.56 by the end of the morning session, while the Shanghai Composite Index gained 0.9% to 3,626.11.

The Hang Seng index dropped 0.1% to 23,954.91. The Hong Kong China Enterprises Index lost 0.2% to 8,510.67.

** The People's Bank of China cut the amount of cash that banks must hold in reserve on Monday, its second such move this year, freeing up 1.2 trillion yuan ($188 billion) in long-term liquidity to bolster slowing economic growth.

** Consumer staples rose 2.5%, with liquor makers leading the jump and up nearly 4%.

** Liquor giant Kweichow Moutai, the biggest stock in the A-share market by market cap, surged 3.6%.

** Hot sectors such as semiconductor and new energy climbed 2.6% and 1.8%, respectively, after some investors took profits in the previous session.

** Real estate developers retreated 0.9%.

** Hong Kong shares edged down as index heavyweight Alibaba Group slumped 5.1% after witnessing its biggest jump since listing in Hong Kong in the previous session.

** The volatility in share price showed divergent views on the e-commerce giant's outlook, analysts noted, especially after Alibaba said it would reorganise its international and domestic e-commerce businesses and replace its finance chief.

** The Hang Seng Tech Index was flat, with internet giants Tencent Holdings and Meituan inching up less than 1%.

** Philip Li, investment director at Wellington Management, said the shares of internet firms hit by a crackdown have already reflected the regulatory risks and the sector is attractive now.

** China Evergrande Group hit an all-time low after it missed a debt payment deadline, putting the developer at risk of becoming China's biggest defaulter, although hopes of a managed debt restructuring calmed fears of a messy collapse.

** The healthcare sector rebounded 2.7% after last session's 5.8% slump.