Hang Seng Index trades near 11-month high as mainland funds seen aiding Chinese telecoms stocks after sell-off
- Hang Seng Index closed with a small gain on Monday as attempt to scale one-year high fizzled out in late pullback
- Chinese telecoms giants lead gains as funds buy the dip after a sell-off sparked by deletions from major indices
The Hang Seng Index added 0.1 per cent to 27,908.22, taking the benchmark to the highest level since February 17 last year as an attempt above 28,000 level fizzled out. The index rose about 3.3 per cent through Friday in the market’s best start to a year since 2018.
The Shanghai Composite Index closed 1.1 per cent lower to 3,531.50, the biggest daily drop in almost three weeks.
“The negative factors which dragged down the telecommunications stocks were already priced in, many investors started to buy the dips on Friday,” said Willer Chen, an analyst at Forsyth Barr Asia in Hong Kong. High dividend yields and cheaper valuations will ease the selling pressure, “plus southbound capital are supporting their gains,” he added.
Sunny Optical also gained in Hong Kong with traders expecting the phone lens maker to be included in a list of Apple suppliers later this month or in February. The stock surged 5.2 per cent to a record HK$199.
