Hong Kong stocks ended 0.80 percent higher Wednesday, adding to the previous day's healthy rally following a positive lead from Wall Street. The benchmark Hang Seng Index rose 189.76 points to 23,971.87 on turnover of HK$79.82 billion (US $10.30 billion). The index rose 1.7 percent on Tuesday, in line with a regional uptick on easing concerns over the crisis caused by the downing of a Malaysia Airlines jet in Ukraine last Thursday.
On Wednesday's exchanges investors welcomed a pick-up on Wall Street, which climbed in response to strong earnings and data showing sales of existing homes in June accelerated to their fastest pace since October. Also, the Labour Department said inflation slowed to 0.3 percent in June from 0.4 percent in May, easing pressure on the Federal Reserve to raise interest rates sooner than when it is expected in mid-2015.
The Dow rose 0.36 percent, the S&P 500 gained 0.50 percent and the Nasdaq added 0.71 percent. "A combination of US earnings optimism, positive US economic data and a slight downgrade to Russia risk has ignited markets," IG said, according to Dow Jones Newswires.
"While we were expecting to see gains for Asia at the open this morning, very few would have expected the magnitude of the gains we're seeing now." Cathay Pacific Airways jumped 1.53 percent to HK$14.60, HSBC was unchanged at HK$80.10 and PetroChina surged 3.05 percent to HK$10.80. China Mobile rose 0.9 percent to HK$84.1, Tencent added 0.16 percent to HK$124.3 and ICBC bank was 1.39 percent higher at HK$5.12. In China the benchmark Shanghai Composite Index rose 0.15 percent, or 3.01 points, to 2,078.49 on turnover of 106.7 billion yuan ($17.2 billion). The Shenzhen Composite Index, which tracks stocks on China's second exchange, dropped 1.08 percent, or 12.03 points, to 1,102.73 on turnover of 119.7 billion yuan.
"Investors shifted their focus to bluechip and cyclical stocks on the Shanghai market for their cheap valuations," Zheshang Securities analyst Zhang Yanbing told AFP. But gains were limited by worries over market liquidity, as five companies started offering shares for subscription, analysts said. On the Shanghai market, financial and resources firms outperformed. Ping An Insurance Group rose 2.14 percent to 41.08 yuan while China Construction Bank climbed 0.77 percent to 3.93 yuan.
Coal miner SDIC Xinji Energy jumped 8.11 percent to 4.00 yuan and Jiangxi Copper advanced 3.81 percent to 13.35 yuan. Shenzhen-listed technology firms lost ground. Hangzhou Huaxing Chuangye Communication Technology tumbled 9.91 percent to 14.09 yuan while Beijing Lanxum Technology slumped 7.26 percent to 20.68 yuan.
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