Hong Kong stocks rebound from US$196 billion rout on China PMI reports, NPC meeting

All eyes will be on the National People’s Congress (NPC) starting on Wednesday for stimulus policies

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A photo taken on February 26, 2025, shows smart equipment running at a coil factory in Harbin Electric Machinery Company in Harbin, northeast China’s Heilongjiang Province. Photo: Xinhua

Published: 10:22am, 3 Mar 2025Updated: 4:21pm, 3 Mar 2025

Hong Kong stocks rebounded on Monday from a rout that erased US$196 billion in market value, as reports showed that China’s manufacturing expanded and investors looked to the nation’s annual legislative meeting for more stimulus policies.

The Hang Seng Index rose 0.3 per cent to 23,006.27 at the close, recovering some of the 3.3 per cent loss on Friday. The Hang Seng Tech Index dropped 0.6 per cent. On the mainland, the CSI 300 Index was little changed and the Shanghai Composite Index fell 0.1 per cent.

Alibaba Group Holding led the gains on the broader market, rising more than 2 per cent. Bubble tea maker Mixue Group, whose stock offering drew record interest from individual investors, surged by as much as 47 per cent on the first day of trading in the city.

The purchasing managers’ index (PMI) of the manufacturing industry rose to 50.2 in February from 49.1 for the previous month, the National Bureau of Statistics said over the weekend. A reading above 50 indicates expansion, while a reading below 50 suggests contraction. A private PMI compiled by Caixin also rose to 50.8 last month from 50.1 in January, according to the report released on Monday.

All eyes will be on the National People’s Congress (NPC) due to kick off on Wednesday, in which lawmakers will vet the annual targets for economic growth, fiscal spending and inflation, as well as other development goals set in the government work report. Issues like boosting consumption and enhancing tech innovation are also expected to be highlighted in the report, according to analysts.

“Investors have some policy expectations from the meeting, and that’ll underpin Hong Kong stocks,” said Zhou Hao, an analyst at Guotai Junan Securities in Hong Kong. “Given the fact that overseas investors are still light in positioning on Hong Kong stocks and the stocks have discounts to major global indexes, the Hong Kong market is still attractive.”