Hong Kong stocks rise as investors bet on China’s economic rebound, Fed rate cut

Name: SCMP
Telephone: +852-2680-8888

China’s crisis-hit property market has shown some early signs of picking-up as Country Garden followed Vanke in reporting better sales

Reading Time:2 minutes

Why you can trust SCMP

Screens showing the index and stock prices outside Hong Kong Exchange Square (HKEX) in Central. Photo: Sun Yeung

Jiaxing Li

Published: 10:41am, 6 Jun 2024Updated: 4:42pm, 6 Jun 2024

Hong Kong stocks gained ahead of trade data that is likely to show more signs of recovery in the Chinese economy, while sentiment was also driven by hopes the US Federal Reserve could start cutting rates this year following a weak US May private payrolls report overnight

The Hang Seng Index added 0.3 per cent to close at 18,476.80 on Thursday, after gaining as much as 1.5 per cent earlier in the day. The Tech Index jumped 0.9 per cent, while the Shanghai Composite Index declined 0.5 per cent.

HSBC gained 0.6 per cent to HK$68.50 and developer Sun Hung Kai Properties climbed 0.7 per cent to HK$75. China’s largest chipmaker Semiconductor Manufacturing International Corporation (SMIC) jumped 5.6 per cent to HK$18.06 amid a global chip stocks’ frenzy. Online travel agency Trip.com climbed 1.8 per cent to HK$407.40, rebounding from lows struck after its convertible bonds sales plan.

A government report on Friday is expected to show China’s exports expanded by 5.7 per cent in May, a faster pace compared with the 1.5 per cent growth in April, according to estimates in a Bloomberg poll.

A drone photo shows machinery at a port in Lianyungang City, east China’s Jiangsu Province. A government report on Friday is expected to show China’s exports expanded by 5.7 per cent in May. Photo: Xinhua

“Macro data is likely to show more consistent improvements in the coming months as the previous policy support measures start to come through, so I don’t think there could be much downside surprise on this front,” said Jason Chan, senior investment strategist at Bank of East Asia. Meanwhile, the market is more confident about interest rate cuts in the US following soft labour market data and this has fuelled risk appetite, he added.