Hong Kong Stocks Rally on Property Developer Support and Economic Optimism

Hong Kong stocks saw an upward trend, building on last week's gains, after Chinese regulators expressed their support for the financing activities of property developers. The Hang Seng Index rose 1.5% to 17,717.60, and the Hang Seng Tech Index gained 2.1%, while the Shanghai Composite Index added 0.5%. This positive momentum follows China's financial regulators announcing their backing for property developers to receive loans, issue bonds, and obtain reasonable equity financing from capital markets.

Developers like Longfor Group and China Resources Land saw gains of 1.9% and 2.4%, respectively, on the news of regulatory support for their financing activities. Analyst Zhang Xia from China Merchants Securities noted, "Market risk appetite is expected to pick up as ramped-up policy support is set to improve the economic outlook."

Alibaba Group Holding rebounded 1.3% to HK$74.20 after the office of founder Jack Ma clarified that he remained positive about the company in the wake of his shares disposal plan. Online game operator NetEase rose 3.2% to HK$185.10 following Morningstar's projection of blockbuster title launches next year, and Tencent Holdings added 3.9% to HK$327.60.

The Hang Seng Index gained 1.5% the previous week, buoyed by better-than-expected China economic data and positive developments between Presidents Xi Jinping and Joe Biden. However, Alibaba's decision to cancel the spin-off of its cloud computing business and Jack Ma's share divestment plan tempered the overall market gains.

UBS Group's report on Monday predicted a 15% gain for the MSCI China Index next year, driven by a 10% earnings growth and an expansion of the price-to-earnings ratio. This echoes a similar call by Goldman Sachs last week.

In other developments, Chinese electric-vehicle maker Li Auto jumped 2%, and pharmaceutical company Wuxi Apptec advanced 4.1%, following the announcement that both stocks would join Hong Kong's stock benchmark starting December 4.

Major Asian markets showed mixed results on Monday morning, with Japan's Nikkei 225 slipping 0.2%, South Korea's Kospi rising 0.9%, and Australia's S&P/ASX 200 adding 0.1%. Chinese smartphone maker Xiaomi gained 0.5% ahead of its earnings release, with analysts estimating a 120% YoY jump in net income for the third quarter.

By fLEXI tEAM