Update | Shares in mainland China surge, while Huatai fails to impress in Hong Kong debut

Stocks in mainland China roared back to life on Monday, with surges in the benchmark indices of almost 5 per cent, while a disappointing debut from Huatai Securities failed to spark sizeable gains in Hong Kong’s main index.

The Shanghai Composite Index jumped 4.71 per cent to 4,828.74, in the biggest one-day gain since January 21. It was outdone by the Shenzhen Composite Index’s 4.79 per cent advance to 2,926.96, its biggest daily rise since January 2012. The Shenzhen gauge is just below a record intraday high of 2,967.53 hit on Thursday, before it tumbled 5.5 per cent by the close of that day, when the Shanghai benchmark ended with a 6.5 per cent loss.

Investors were encouraged by economic data that showed a modest pick-up in Chinese manufacturing activity last month.

In Hong Kong, Huatai finished its first day of trading with a gain of just 4.8 per cent at HK$26.05. Many had expected China’s biggest brokerage by trading volume to make a strong debut after record turnover on mainland exchanges.

The Hang Seng Index finished up 0.63 per cent or 172.97 points to close at 27,597.16, recovering from earlier losses, with mainland insurance and property stocks leading the way. The H-share index of mainland Chinese firms listed in the city added 1.39 per cent, or 195 points, to 14,299.

“Many retail investors in Hong Kong had expected Huatai’s first day of trading to be another blockbuster IPO, but its performance was rather disappointing since there were more cashing out on the first day,” said Louis Tse, a director of VC brokerage. “There was no guarantee that a big IPO would translate into jackpot in the first day.”