Hong Kong stocks rallied 2.00 percent Wednesday, following another record-breaking close on Wall Street and ahead of a closely watched US Federal Reserve policy decision later in the day. The benchmark Hang Seng Index added 457.48 points to 23,304.02 on turnover of HK$60.84 billion ($7.85 billion). Banking stocks accounted for much of the day's gains with Bank of Communications Co and Bank of China Ltd gaining 2.9% and 2.2% respectively ahead of third-quarter profit reports.
Retailer Esprit Holdings, which reported its first fiscal year loss since 1993 last month, also closed at its highest level ($HK13.80) since May 2012, buoyed by news that an executive from Spanish clothing giant Zara had been hired to lead their product team. Chinese shares closed up 1.48 percent. The benchmark Shanghai Composite Index gained 31.60 points to 2,160.46 on turnover of 95.2 billion yuan ($15.6 billion). The index was lifted by hopes of market reforms, with state media reporting the government may soon allow companies in some sectors to issue preferred shares - giving holders priority in dividend payments - to raise funds. "Gains in power and bank shares were supported by talk of preferred shares," Haitong Securities analyst Zhang Qi told AFP.
Sichuan Mingxing Electric Power surged by its 10 percent daily limit to 9.41 yuan and SDIC Power Holdings soared 9.70 percent to 4.41 yuan. China Citic Bank gained 3.09 percent to 4.00 yuan and Agricultural Bank of China rose 1.18 percent to 2.57 yuan. Oil firms rose on hopes China will hike government-set fuel prices this week. Sinopec advanced 3.46 percent to 4.49 yuan while PetroChina rose 2.23 percent to 7.78 yuan.
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