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Hong Kong stocks waver near 7-week high on mixed corporate earnings signals while developers trim speculative rally

In Business
February 22, 2024
Hong Kong stocks wavered near a seven-week high amid mixed corporate earnings signals as lender HSBC underwhelmed and travel platform operator Trip.com beat market consensus. Property developers pared gains fuelled by speculation about market-easing measures.

The Hang Seng Index slipped 0.3 per cent to 16,459.93 at 10.10am local time, failing to build on a 1.6 per cent rally on Wednesday. The Tech Index lost 0.4 per cent, while the Shanghai Composite Index advanced 0.4 per cent.

HSBC tumbled 1.9 per cent to HK$59.10 after its 2023 earnings missed market consensus, while China Merchants Bank fell 0.5 per cent to HK$31.30. Sun Hung Kai Properties declined 0.5 per cent to HK$74.75 and peer Henderson Land dropped 1.1 per cent to HK$21.65.

Limiting losses, Trip.com surged 2.3 per cent to a record HK$339 after fourth-quarter revenue exceeded expectations. Alibaba Group strengthened 1.8 per cent to HK$74.20 and China’s largest chip maker SMIC rose 1.7 per cent to HK$15.32. Tech stocks rallied after graphic card maker Nvidia forecast a threefold surge in quarterly revenue.

“While policy support may help consolidate the market bottoms in late January, weak business fundamentals and a lack of new capital indicate that a stock market recovery is not likely to unfold in a one-way direction,” Patrick Pan, China equity strategist at Daiwa Capital Markets, said in a note.

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The Hang Seng Index is still on course to record another weekly advance, having already risen 1 per cent since Friday. Beijing’s recent market measures, including “national team” buying, lending rate cut, liquidity injection, and measures to curb short-selling, have helped put a floor under an unprecedented four-year slump in Hong Kong.

Elsewhere, major Asian markets mostly traded higher after Nvidia fuelled overnight gains in US equities. The Nikkei 225 in Japan advanced 1.6 per cent and the Kospi Index in South Korea added 0.4 per cent, while the S&P ASX 200 in Australia was little changed.

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