Hong Kong stocks surge on stimulus hope

December 10th, 2008 - 6:24 pm ICT by IANS  

Hong kong, Dec 10 (Xinhua) Hong Kong stocks closed 5.6 percent higher Wednesday on hope that China will come up with greater stimulus packages amid the latest downbeat producer price index in November. The benchmark Hang Seng Index rose 192.78 points, or 1.31 percent, to open at the day’s lowest 14,946 and widened its gains afterwards, boosted by huge rallies of H-shares or companies registered in the Chinese mainland.

China’s producer price index grew only by 2 percent year on year in November, a worse-than-expected reading many investors saw as good reason for authorities to come up with greater economic stimulus package in the days to come.

Buying orders enforced in the afternoon session, propelling up the index by 824.52 points, or 5.59 percent, to close at 15,577.74, a tick off the day’s peak 15,578.96.

Turnover rose to 61.85 billion HK dollars ($8 billion) from Tuesday’s 56.93 billion HK dollars ($7.35 billion).

Among 42 components of the benchmark Hang Seng Index, advancing companies greatly outnumbered declining shares 40 to 2.

Market heavyweight China Mobile, the country’s largest telecommunications operator and the market’s top company measured by capitalization, was the major driving force for Wednesday’s upsurge, up 5.45 percent to 82.25 HK dollars, contributing 111.42 points to the market’s gains.

Another market giant HSBC, which accounts for the largest weighting of the index, rose 4.41 percent to 87.7 HK dollars, lifting the index by 94.63 alone.

Hong Kong Exchanges and Clearing Ltd., the market’s sole operator, went up 6.45 percent to 75.05 HK dollars though Morgan Chase cut its target price from 120 HK dollars to 55 HK dollars.

H-shares, which reflect the performance of 42 companies registered in the Chinese mainland, rebounded sharply by 505.75 points, or 6.32 percent, to close at 8,507.49.

China’s energy companies were sharply higher. PetroChina, the country’s largest oil producer, advanced 5.96 percent to 7.11 HK dollars. CNOOC, China’s largest offshore oil company, soared 12.71 percent to 7.45 HK dollars. Sinopec, Asia’s largest oil refiner, bounced back 6.68 percent to 5.43 HK dollars.

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