Hong Kong stocks at 1-month high as China’s commodity markets rally
Hong Kong stocks hit a one-month high on Tuesday as Chinese commodity prices rallied, offsetting pressure from profit taking in some state-owned enterprises (SOEs) which rose last week on restructuring hopes.
The Hang Seng index rose for a fourth consecutive session, ending up 0.8 per cent to 22,744.85 points, while the Hong Kong China Enterprises Index gained 0.6 per cent to 9,664.19.
Shanghai futures contracts for rebar and coking coal surged around 7 per cent and 9 per cent on the day, respectively, as China’s state planner said the steel and coal sectors will face increasing pressure to cut capacity this year.
Earlier in the day, data showed China’s producer prices surged the most in more than five years in December, compared with a year earlier, as a construction boom boosts demand for building materials from cement to steel.
Capacity cuts have also fuelled the spike in commodity prices, boosting profits.
Most sectors were up, but telecommunications and energy fell as investors took profits on sharp gains in index heavyweights China Mobile and CNOOC Ltd seen last week.
Shares of Chinese retailer Intime Retail Group soared more than 35 per cent on news that e-commerce giant Alibaba Group Holding Ltd was seeking to take Intime private.