Hong Kong stocks rebounded, clawing back some of the losses from the worst start to a year since 2019, as Chinese regulators ramped up support for institutional buying to shore up sentiment and rebuild investor confidence.
The Hang Seng Index (HSI) rose by 0.7%, the Hang Seng Tech Index (HSTECH) climbed by 1%.
MINISO Group rose 9%; Xiaomi rose 7%; Nio rose 2.5%; Meituan, Li Auto rose 2%; Alibaba rose 1.6%; Tencent fell 0.4%.
Still, the prevailing risk appetite remained subdued and investors increased their purchases of fixed-income products, a reflection of scepticism about a strong recovery in Chinese growth. The yield on China’s benchmark 10-year government bond breached 1.6 per cent for the first time in history on Friday.
Some 20 securities firms, fund managers and insurance companies received 55 billion yuan (US$7.53 billion) worth of liquid assets from the People’s Bank of China in a swap facility that can be used as collateral for borrowing to buy stocks, the central bank said in a statement. It was the new facility’s second operation since it was introduced in September as part of a rescue package for stocks and the economy.
Meanwhile, the China Securities Regulatory Commission (CSRC) rejected rumours of massive redemptions of mutual funds by insurance companies, which some investors believed were partly to blame for the market decline on Thursday. On Thursday night, the CSRC said it had looked into who the source of the false information was, adding that it would ramp up enforcement.
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