Hong Kong, Shanghai stocks soar

Shares in Hong Kong rose on Wednesday, led by material and resource issues on the back of higher commodity prices and speculation that China would roll back policy tightening later this year to support growth. Hong Kong's benchmark Hang Seng Index gained 1.1 percent to close at 20,487.23, just off the day's high. The China Enterprises Index of top locally listed mainland firms rose 1.6 percent.
Commodity-related counters extended gains after metals and oil prices rose. The Shanghai Composite rose 0.3 percent to a three-week high and extended its gains for the week to nearly 5 percent, outperforming other Asian stocks. The MSCI index of Asian shares outside of Japan rose about 0.8 percent.
Angang Steel Co was the top gainer on the China Enterprises Index, rising nearly 8 percent. Hong Kong-based ports operator China Merchants Holdings (International) Co rose 3.2 percent. Coal miner China Shenhua Energy Co, which has lost more than a quarter of its value this year on fears of a sharp slowdown in China's economy, rose 2.6 percent. The Hang Seng was also well supported by index heavyweight HSBC, which rose 2.2 percent.
Gains were limited slightly by a fall in consumer goods exporter Li & Fung. Investors booked profits in the year's top performer on the Hang Seng, sending the shares down by 1.8 percent. The Shanghai Composite Index closed up 6.664 points at 2,535.39 and turnover continued to pick up. The rise extended a 4.3 percent rally this week on speculation that China might relax policy in the second half of the year as economic growth slows down.
Alternative energy shares rose after local media reported that China had compiled a blueprint to promote investment in the sector. Among the biggest gainers on the Shanghai market, Shanghai Aerospace Automobile Electromechanical Co increased 8.7 percent and Xi'an Aero-engine PLC gained 6.7 percent.
Several analysts said confidence was rising that China's stock market had reached a floor after sliding to a 15-month low early this month. Beijing's moves to deflate speculation in the country's fiery property sector triggered a 23-percent fall on the stock index this year, making it Asia's worst-performing market. In a sign that sentiment is improving amongst Chinese retail investors, who dominate trading on the mainland, 6 percent more stock trading accounts opened last week than the week before, official data showed.