China, Hong Kong stocks surge at open on Beijing’s stimulus vow

HONG KONG: China and Hong Kong stocks surged at open on Tuesday after top policymakers vowed to ramp up policy stimulus to spur growth.

China, Hong Kong stocks ease as inflation slows

• The blue-chip CSI300 index rallied 3.2% at open, while the Shanghai Composite index added 2.6%.

• Hong Kong’s benchmark Hang Seng jumped 3.2% at open, adding to Monday’s 2.8% gain. The tech index surged 4.2%.

• Next year, China will adopt an “appropriately loose” monetary policy, the first easing of its stance in some 14 years, alongside a more proactive fiscal policy to spur economic growth, state media Xinhua reported after-market on Monday, citing a readout of a meeting of top Communist Party officials, the Politburo.

• Authorities will also step up “unconventional” counter-cyclical adjustments, focusing on expanding domestic demand and boosting consumption, the report added.

• “The strong tone on policy stance suggests that Beijing is very determined to stabilize growth and will step up fiscal spending next year,” Nomura economists said.

• For 2025, Beijing may stick to “around 5.0%” GDP growth target and raise the fiscal deficit to GDP ratio to 4.0% from 3.0% in 2024, they added.

• Investors will now turn their focus to this week’s Central Economic Work Conference, where key targets and policy directions will be set for the next year.