Hong Kong stocks post early gains after upbeat corporate earnings but caution prevails as investors eye monetary policy

Hong Kong stocks post early gains after upbeat corporate earnings but caution prevails as investors eye monetary policy

20 Mar Hong Kong stocks post early gains after upbeat corporate earnings but caution prevails as investors eye monetary policy

Posted at 03:05h in Asia by

Hong Kong stocks edged higher after corporate earnings fuelled gains in sportswear company Li Ning and telecoms giant China Unicom, although the mood was cautious after China’s central bank kept its benchmark lending rates unchanged.

The Hang Seng Index added 0.3 per cent to 16,577.37 as of 10.10am local time, after retreating 1.2 per cent on Tuesday. The Tech Index gained 0.3 per cent, while the Shanghai Composite Index climbed 0.2 per cent.

Sportswear brand Li Ning surged 4.9 per cent to HK$21.30 after better than expected fourth quarter performance, and its peer Anta Sports gained 3 per cent to HK$80.05.

“We saw stabilising inventory conditions, better than expected online retail sales in the fourth quarter, in-line full year 2023 earnings, significant amortizations in the second half and increased dividend and buy-backs,” said analysts at Jefferies after Li Ning’s earnings announcement.

China Unicom climbed 1.8 per cent to HK$5.67 after reporting a record income for last year, with HSBC analysts saying “the results presentation indicated broad progress in developing new business areas in IOT, private 5G networks, cloud services and infrastructure, and communications”. Drug maker CSPC Pharma and energy supplier Towngas jumped ahead of their earnings later today.

The five-year loan prime rate (LPR), a reference for mortgage rates, was left unchanged at 3.95 per cent, according to a statement by the People’s Bank of China (PBOC). The one-year rate was also held at 3.45 per cent, in line with expectation. That follows the central bank’s decision to keep the rate on one-year medium-term lending facility at unchanged 2.5 per cent last week, dashing hopes for additional monetary easing.

Elsewhere, three stocks began trading on Tuesday. Cinderson Technology surged 87 per cent from its IPO price, to 36 yuan in Shanghai, Shenzhen Jdd Tech New Material advanced 76 per cent to 98.30 yuan in Shenzhen and drug maker Qyuns Therapeutics jumped 34 per cent to HK$26.50 on its first day of trading in Hong Kong.

Key Asian stock markets were broadly firm. Japan’s Nikkei 225 added 0.7 per cent, South Korea’s Kospi Index advanced 1.2 per cent while Australia’s S&P/ASX 200 gained 0.3 per cent.

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