Hong Kong stocks rally after initial dip on March’s opening session

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1st March 2024 – (Hong Kong) The opening trading day of March saw Hong Kong’s Hang Seng Index (HSI) stage a notable comeback after an initial dip. The index, which started the day off by shedding 120 points to rest at 16,390, plunged at one stage by 190 points to hit an intraday low of 16,321. However, it was soon buoyed by purchasing enthusiasm, subsequently regaining ground by 101 points or 0.61%, to reach 16,613.

Meanwhile, the H-shares index climbed by 45 points or 0.79% to 5,723 points, and the technology index edged up by 44 points or 1.29% to 3,475 points.

The performance of the heavyweight tech stocks was mixed, with Tencent slightly down by 0.3% and Alibaba dropping by 0.1%. On the other hand, food delivery giant Meituan soared by 6.7%, while smartphone maker Xiaomi Group and e-commerce conglomerate JD.com rose by 1% and 1.1%, respectively. Internet technology company NetEase faced pressure following its earnings release, tumbling by 4.5%.

Banks offered substantial support to the market, with HSBC Holdings advancing by 1.6% and China Ping An Insurance by 1.1%. Construction Bank increased by 0.6% and Industrial and Commercial Bank of China moved up by 0.4%, whereas the Hong Kong Exchanges and Clearing Limited experienced a slight contraction of 0.4%.

Property stocks saw a divergence in performance, with New World Development sliding by 5% post-earnings, Sun Hung Kai Properties elevating by 1.2%, CK Asset Holdings declining by 1.1%, and Henderson Land Development ticking up by 0.2%.

The electric vehicle sector was in high demand, with Xpeng Motors accelerating by 6.6%, NIO lifting by 6.5%, and Li Auto appreciating by 1.1%, while BYD Company held steady.

Looking ahead, the market sentiment for March remains cautious. With the Chinese National People’s Congress meetings on the horizon, all eyes are on potential economic stimulus measures and debt alleviation for enterprises. The upcoming corporate scores from Chinese companies are unlikely to hold positive surprises, according to Yao. In addition, while the U.S. Federal Reserve’s interest rate decision this month is anticipated to maintain the status quo, it might provide insights into future rate cuts. Amidst various uncertainties, the Hong Kong stock market is expected to remain subdued, cautioning investors against hasty decisions.