Daily Report | Hong Kong, China stocks close mixed on weak results and expectations of stimulus policies

Mainland Chinese equities swung between gains and losses on Wednesday, closing slightly higher on expectations of new stimulus policies from Beijing, while Hong Kong stocks fell as investor sentiment soured amid weak company results.

The Shanghai Composite Index added 0.35 per cent to close at 3,009 after changing direction repeatedly through the day as investors tested the strength of the recent rally which pushed the benchmark up 10 per cent in two months.

China technology counters gained Wednesday while airline stocks declined after the deadly terrorist attacks in Brussels. Air China was among the worst performers, down 1.44 per cent to close at 6.48 yuan (HK$7.74)

Victor Au, chief operating officer at Delta Asia Financial Group, said the fluctuation in Chinese stocks comes as investors adopt a wait-and-see attitude on expectations of new stimulus policies to be introduced during the Boao Forum this week.

Hong Kong stocks were down slightly on Wednesday, with the benchmark Hang Seng index dipping 0.25 per cent to 20,615 points. The Hang Seng China Enterprise Index, tracking China-based companies, fell 0.3 per cent to 8,873.19.

Tencent, the most heavily traded stock, edged up 0.13 per cent to close at HK$159.7. But its turnover slumped to HK$2.46 billion from Tuesday’s HK$3.18 billion.

Au said investors believe it is safer to stay on the sidelines during the ongoing Boao Forum, adding that the upcoming Easter holidays will also reduce investment appetite.