- Good momentum of southbound buying may continue: Partners
- Most economists predict Fed will hold rates later on Wednesday
Hong Kong stocks rose amid buying by mainland investors as a jump in crude boosted energy producers.
The Hang Seng Index climbed 0.6 percent at the close, its highest level since Sept. 9 after dropping as much as 0.4 percent earlier. Net inflows via an exchange link with Shanghai climbed to 3.9 billion yuan ($585 million) on Wednesday. China Petroleum & Chemical Corp. jumped the most in a month as U.S. oil climbed 2 percent.
Mainland purchases of Hong Kong shares have helped lift the Hang Seng Index 14 percent higher this quarter, along with speculation U.S. interest rates will remain low. All but four of 102 economists surveyed by Bloomberg predict the Federal Reserve will hold off from raising borrowing costs at its meeting Wednesday, while the Bank of Japan refrained from moving deeper into negative interest-rate territory and shifted the focus of its stimulus to controlling the yield curve.
“Southbound buying through the link is continuing and the good momentum will probably go on,” said Ronald Wan, chief executive of Partners Capital International Ltd. “Also, people are expecting no change in terms of U.S. interest rate hikes.”
Purchases by mainland investors have been a source of support for Hong Kong equities in recent weeks even as volatility increased amid uncertainty over whether global authorities will increase their monetary stimulus. Net buying via the connect had reached the highest since April 2015 on Sept. 9 as cheaper valuations of dual-listed shares in the city lured investors.
The Hang Seng Index climbed to 23,699.90, while the Hang Seng China Enterprises Index increased 1 percent. The Shanghai Composite Index added 0.1 percent.
China Petroleum and Cnooc Ltd. advanced at least 1.2 percent in Hong Kong on Wednesday. China Overseas Land & Investment Ltd. led gains for a gauge of the developers listed in the city.
Postal Savings Bank of China Co. is poised to raise $7.4 billion in a Hong Kong initial public offering that will be the world’s biggest first-time share sale this year, according to people familiar with the matter. The Chinese bank’s first-time share sale would be the largest globally since Alibaba Group Holding Ltd. priced a $25 billion New York offering in September 2014, data compiled by Bloomberg show.
Monetary authorities will continue to hog the limelight on Thursday with speeches due from the new governor of the Reserve Bank of Australia as well as the heads of the European Central Bank and the Bank of England.
— With assistance by Shidong Zhang