BEIJING: Chinese stocks trading in Hong Kong rose to a seven-year high, tracking Monday’s surge for mainland equities, amid speculation cross-border sales of funds will fuel demand for the city’s equities.
Financial and industrial shares led the rally in the city, with Haitong Securities Co., China Life Insurance Co., China Railway Group Ltd. and China Communications Construction Co. soaring more than 3 percent. Han’s Laser Technology Inc. climbed 5.1 percent to pace gains for technology shares in the mainland.
The Hang Seng China Enterprise Index gained 2.8 percent to 14,838.40 at 10:27 a.m.. The Shanghai Composite Index rose 0.5 percent, adding to Monday’s 3.4 percent advance. China and Hong Kong approved cross-border sales from July 1 in a move that will widen access to financial markets and capital in the world’s second-largest economy. The initial quota will be a total 600 billion yuan ($97 billion), split evenly in each direction.
“Most people expect the Hong Kong market to benefit from the mutual fund recognition and go up,” said Yen Chiu, a Hong Kong-based trader at Shenwan Hongyuan Group. “There’s a great catch-up rally after A shares jumped yesterday.”
Hong Kong’s Hang Seng Index increased 1.3 percent, while the CSI 300 Index, which surpassed the 5,000 level Monday, increased 0.4 percent. Trading volumes in Shanghai were 32 percent above the 30-day average while Hong Kong’s turnover jumped 47 percent.
