HONG KONG: Hong Kong stocks closed higher on Wednesday, coming off the Lunar New Year holidays, with investors awaiting moves by Chinese authorities to help support the country’s struggling stock market.
Mainland China’s financial markets are closed through the week for the Lunar New Year.
Hong Kong’s Hang Seng Index closed up 0.8% on Wednesday, having dropped 1.8% at the start of trading before reversing course.
The index gained 1.4% last week but is down 7% so far in 2024 after dropping nearly 14% last year.
The Hang Seng China Enterprises Index was up 1.6%, while Hong Kong-listed Chinese tech firms rose 2.5%.
Just before the break, China replaced the head of its market regulator with a securities regulator veteran who has led the Shanghai Stock Exchange and is known for his tough line on market malpractice.
Chinese authorities have announced a raft of measures to aid its stock market after domestic stocks plunged to five-year lows earlier this month.
So far, the moves — which include curbs on short selling and state fund Central Huijin Investment’s expanded stock buying — have failed to turn investor sentiment around.
Market sentiment remains somewhat skeptical on Chinese equities, with valuations appearing attractive compared to historical levels and against broader global markets, said William Fong, head of Hong Kong and China equities at Barings.
“If investors can remain patient, we believe this backdrop provides an attractive entry point for longer-term investors.”
Asian shares slid on Wednesday, while the dollar and Treasury yields jumped as traders pared back expectations for the pace and scale of rate cuts by the Federal Reserve this year following data that showed US inflation remained sticky.
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