Hong Kong stocks edged up to
fresh one-month highs on Wednesday morning tracking regional
markets as investors awaited U.S. President-elect Donald Trump's
news conference for clues that could set near-term direction for
China stocks slipped due to an increase in equity supply and
as mainland airlines weakened after their recent rally on the
back of lower oil prices.
The benchmark Hang Seng index headed for a fifth
winning session, up 0.7 percent, to 22,899.55 points, while the
Hong Kong China Enterprises Index gained 0.6 percent, to
Investors are looking to Trump's first news conference since
he won the U.S. presidential election for any hints about his
policies. In his campaign, he promised to slash taxes and boost
fiscal spending which sent Wall Street to record highs.
But he also vowed to brand China a currency manipulator on
his first day in office and has threatened to slap huge tariffs
on imports from China, raising political uncertainty between the
world's two biggest economies.
Nearly all sectors in Hong Kong advanced, led by resource
stocks, underpinned by strong commodities prices on the
mainland. The sector was up around 2.4 percent at midday.
Bucking the broad trend was the utilities sector.
The rising U.S. interest rate outlook under Trump's
administration has pressured the high dividend-paying firms'
balance sheets. Hong Kong's interest rates typically react to
U.S. monetary policies due to the Hong Kong dollar's peg to the
In China, the CSI300 index fell 0.5 percent, to
3,340.94 points at the end of the morning session, while the
Shanghai Composite Index lost 0.5 percent, to 3,144.99
Analysts say an apparent increase in equity supply, fuelled
by faster approvals of initial public offerings (IPO) and
stepped-up issuance of additional shares by listed companies,
have put liquidity pressure on the market.
China's securities regulator approved 14 IPO applications on
Friday, which was expected to raise up to 4.8 billion yuan
Most sectors lost ground in the mainland market.
Transportation stocks, down 1.47 percent, was
largely dragged lower by airlines succumbing to profit-taking.
China Southern Airlines fell more than 3.2
percent after adding nearly 7.4 percent in the previous session
on investor optimism over possible restructuring.
The airline has since clarified news reports by saying
mix-ownership reform would only be implemented by its parent and
hasn't involved the company.
($1 = 6.9236 Chinese yuan)