HONG KONG: Hong Kong’s benchmark stock index resumed gains on Friday after a brief pull back from a record two days earlier, boosted by gains in banks and internet giant Tencent Holdings, but some analysts cautioned that the gains may not continue with the Lunar New Year holiday imminent.
The benchmark Hang Seng Index rose 1.31 per cent, or 429.35 points, to 33,083.8 at the midday break, while the Hang Seng China Enterprises Index of Chinese companies rose 290.29 points, or 2.17 per cent, to 13,678.45.
“The market‘s rebound is being supported by a stronger renminbi,” said Louis Tse, managing director at VC Asset Management, adding however that a correction in the past two sessions “could go deeper” as short-term investors cash in before the Lunar New Year. He suggested long-term investors wait and take profit later.
Bank stocks rose, led by China Construction Bank (CCB), which advanced 4.32 per cent to HK$8.94. Tse said Morgan Stanley had raised its price target for CCB by around 30 per cent. Its gains triggered rises in other banks, including Industrial and Commercial Bank of China, one of the country’s largest state lenders, which gained 3.68 per cent to HK$7.32, and Bank of China, which added 3.7 per cent to HK$4.76.
Also helping the Hang Seng higher was index heavyweight Tencent, which rose 2.53 per cent to HK$469.6, extending gains after it said on Thursday it would invest in French supermarket Carrefour’s China unit. On the downside, oil companies declined, with PetroChina falling 1.1 per cent to HK$6.28 and CNOOC dropping 2.79 per cent to HK$12.54.
