Hong Kong blue chips rose 3.2 percent, hitting three-week highs on Wednesday, as advancing global equities and Asia-focused bank Standard Chartered's forecast-beating earnings fuelled investor confidence. Chinese financial issues stormed higher after mainland stock markets rebounded sharply and resource plays drew strength from a commodity rally and record gold prices.
Hong Kong's 2008-09 budget, which included various tax concessions, was unveiled earlier by the city's financial secretary and further brightened the market's mood. "The contents of the budget had been discounted, but it did stimulate sentiment," said Alex Wong, director at Ample Finance.
The benchmark Hang Seng Index ended up 3.2 percent, or 769.09 points, at 24,483.84. The China Enterprises Index of Hong Kong-listed mainland companies, or H shares, finished up 4.6 percent, or 610.06 points, at 13,936.90. Mainboard turnover was HK$99.4 billion (US $12.7 billion), the highest level in more than three weeks.
StanChart, which makes three-quarters of its profits in Asia, surged 7.6 percent to HK$259.2 after beating forecasts with a 27 percent rise in 2007 earnings and saying it expects another strong year. StanChart's results fired up HSBC, the day's most active stock, to HK$123.6, a 3.3 percent gain, marking its fifth straight advance, a feat last seen in July. Over the last five sessions, the stock has advanced 9.7 percent.
China Construction Bank climbed 6.1 percent to HK$5.96. China Merchants Bank powered 7.1 percent higher to HK$27.10. China Life jumped 6.1 percent to HK$31.5. Rival Ping An Insurance, the day's best performing blue chip, stormed 8.2 percent higher to HK$60.60. Among resource shares, gold plays outperformed after the yellow metal hit a record high.
Zijin Mining Group Co Ltd shot up 8.7 percent to HK$10.58. China's second-biggest gold miner passed a domestic environmental test, paving the way for it to launch its planned domestic IPO, a paper reported on Wednesday. Aluminium Corp of China (Chalco) leapt 4.4 percent to HK$15.80. The country's top alumina producer is likely to buy 4.18 billion yuan ($584 million) worth of stakes in six sister companies from its parent, Aluminium Corp of China, the official Shanghai Securities News reported on Tuesday.
Sinopec Corp rose 5 percent to HK$8.76 on talk that the oil refiner may receive billions in government subsidies as a result of rising oil prices. Hong Kong Exchanges and Clearing Ltd rebounded from its recent slump, settling up 6.9 percent to HK$152.5.
Office landlord Swire Pacific notched up 1.3 percent to HK$92.75, even though an institutional holder was selling $131 million worth of shares at a 4.48 percent discount to the stock's market close on Tuesday, according to a term sheet.
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