6 December 2019

Hong Kong, Shanghai take cue from US rally

Hong Kong and mainland equities rallied Friday after US stock markets hit record intraday highs overnight.

The benchmark Hang Seng Index surged 1.7 percent to 23,032 points and the Hang Seng China Enterprises Index gained 3 percent to 10,702. The Shanghai Composite Index rose 1.68 percent to 2,135 points.

Nearly all blue chips closed higher as investors bought heavily into coal plays. China Shenhua Energy (01088.HK) and China Coal Energy (01898.HK) climbed 3.1 percent and 2.8 percent, respectively.

Export trading firm Li & Fung (00494.HK) advanced 4 percent ahead of the US Thanksgiving holiday, a key driver of its business.

Banking shares saw notable gains, with the big four lenders rising in a range of 2-3 percent.

Haitong Securities (06837.HK) surged nearly 7 percent while CITIC Securities (06030.HK) and Guotai Junan International (01788.HK) gained more than 6 percent, bouyed by the impending release of guidelines for the national rollout of an over-the-counter equity market.

The move will broaden financial channels for unlisted small-scale enterprises, boosting the prospects for brokerages.

SPT Energy Group (01251.HK) paced the energy sector, closing 7.5 percent higher, while Honghua Group (00196.HK) and Anton Oilfield Services Group (03337.HK) picked up 4.5 percent and 1.6 percent, respectively.

Investors acted on talk shale gas will be the theme of a new energy reform agenda after the Communist Party plenum earlier in the week. 

Jeweler Luk Fook Holdings International (00590.HK) shot up nearly 9 percent to a two-year high after saying sales of gold products and jewelry likely increased significantly during the six months to September from a year earlier.

Rivals Chow Tai Fook Jewellery (01929.HK) and Chow Sang Sang (00116.HK) rose 2.7 percent and 2.8 percent, respectively.

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