June 10, 2019 / 8:38 AM / 10 days ago

HK stocks track global rally on trade, rate cut optimism

* HK->Shanghai Connect daily quota used 9.9%, Shanghai->HK daily quota used 3.5%

* HSI +2.3%, HSCE +1.9%, CSI300 +1.3%

* FTSE China A50 +1.6%

June 10 (Reuters) - Hong Kong stocks tracked a global rally to end higher on Monday after the United States shelved plans to impose tariffs on Mexico and as global investors hoped for lower U.S. interest rates on the back of lacklustre jobs data.

** The Hang Seng index ended up 2.3% at 27,578.64 points, after marking its best session since Dec. 3, 2018. The China Enterprises Index gained 1.9% to 10,526.92 points.

** The United States and Mexico struck a deal on Friday, with Mexico agreeing to rapidly expand a controversial asylum programme and deploy security forces to stem the flow of illegal Central American migrants.

** U.S. job growth slowed sharply in May and wages rose less than expected, raising fears that a loss of momentum in economic activity could be spreading to the labor market, which could put pressure on the Federal Reserve to cut interest rates this year.

** A highly anticipated late June meeting between U.S. President Donald Trump and Chinese President Xi Jinping has some parallels with their Buenos Aires summit last December that postponed a tariff hike, U.S. Treasury Secretary Steven Mnuchin said on Saturday.

** China’s exports unexpectedly returned to growth in May despite higher U.S. tariffs, but imports fell the most in nearly three years in a further sign of weak domestic demand that could prompt Beijing to step up stimulus measures.

** “We believe Beijing will likely step up its stimulus measures to stabilise financial markets and growth,” economists at Nomura said in a note to clients.

** Around the region, MSCI’s Asia ex-Japan stock index was firmer by 0.97%, while Japan’s Nikkei index closed 1.2% firmer.

** The yuan was quoted at 6.9334 per U.S. dollar at 0815 GMT, 0.31% weaker than the previous close of 6.9118.

** The top gainers among H-shares were CNOOC Ltd up 5.26%, followed by Tencent Holdings Ltd, gaining 4.42% and Shenzhou International Group Holdings Ltd, up by 4.29%.

** The three biggest H-shares percentage decliners were Great Wall Motor Co Ltd, which was down 1.85%, Guangzhou Automobile Group Co Ltd, which fell 1.4% and Huaneng Power International Inc, down by 1.4%.

** At close, China’s A-shares were trading at a premium of 25.99% over Hong Kong-listed H-shares. (Reporting by the Shanghai Newsroom, Editing by Sherry Jacob-Phillips)

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