Hong Kong’s stock market soared, buoyed by a Wall Street rally that propelled a key benchmark to a record high and growing optimism surrounding warmer US-China relations. Investors were encouraged by US President Donald Trump’s remarks at the World Economic Forum, where he expressed optimism about ties with China, offering a sentiment boost to the market.
The Hang Seng Index rose by an impressive 1.9 per cent to close at 20,066.19 on Friday, securing a second consecutive week of gains with a 1.3 per cent climb over the five-day period. Technology stocks drove the rally, with the Hang Seng Tech Index surging 3.2 per cent. On the mainland, the CSI 300 Index edged up 0.8 per cent, while the Shanghai Composite Index gained 0.7 per cent.
Leading the charge in Hong Kong, Apple supplier Sunny Optical saw an 8 per cent spike to HK$73.00, while smartphone maker Xiaomi surged 6.8 per cent to HK$36.85. Travel platform Trip.com also performed strongly, advancing 5.3 per cent to HK$541.00.
Trump’s positive tone on US-China relations, describing them as “very good,” resonated across the markets. However, his warning of tariffs on companies failing to manufacture in the US introduced an undercurrent of uncertainty. Additionally, his call for lower interest rates and reduced oil prices lifted sentiment on Wall Street, pushing the S&P 500 Index to a record high, rising 0.5 per cent.
Louis Wong, executive director of Phillip Capital Management, noted that Trump’s comments on interest rate cuts could support Hong Kong stocks, while the threat of tariffs remains a potential headwind. The Hong Kong market, Wong explained, has responded in a volatile pattern to Trump’s statements since his inauguration.
Carmakers also stood out as three leading Chinese electric vehicle assemblers took legal action against the European Commission over anti-subsidy duties imposed last year. BYD rose 1.4 per cent to HK$274.40, Geely Auto gained 2.1 per cent to HK$14.46, and Li Auto advanced 2.8 per cent to HK$89.70.
Nongfu Spring, the bottled water giant, jumped 3.1 per cent to HK$35.10 after its billionaire founder, Zhong Shanshan, pledged to avoid price wars. The company has faced challenges over the past year due to aggressive price cuts and online criticisms that significantly eroded its market value.
In IPO news, logistics provider Avic Yishang Warehouse made a strong debut in Shanghai, rising 15.3 per cent to 3.03 yuan, while infrastructure fund E Fund Huawei Farmers soared 30 per cent to 3.94 yuan in Shenzhen.
Elsewhere in Asia, major markets saw broad-based gains. South Korea’s Kospi climbed 0.9 per cent, Australia’s S&P/ASX 200 added 0.4 per cent, and Japan’s Nikkei 225 remained flat.
Hong Kong’s stock market, benefiting from a robust global sentiment and domestic catalysts, continues to attract investor attention. The market’s rally underlines its resilience amid geopolitical complexities and shifting policy dynamics.
Fidelity China Special Situations PLC (LON:FCSS), the UK’s largest China Investment Trust, capitalises on Fidelity’s extensive, locally-based analyst team to find attractive opportunities in a market too big to ignore.
