Hong Kong shares jump most in 6 months after China cuts policy rates

The Hang Seng index rose 3.4%, to 24,952.35, while the China Enterprises Index gained 3.8%, to 8,761.56 points. ** The one-year loan prime rate (LPR) was lowered by 10 basis points, and the five-year LPR was reduced by 5 basis points — the first reduction since April 2020.

Hong Kong shares jumped the most in more than six months to finish up on Thursday, after China cut a set of key policy rates and lending benchmarks to prop up a slowing economy, with investors pinning hopes on further easing in policies by Beijing. The Hang Seng index rose 3.4%, to 24,952.35, while the China Enterprises Index gained 3.8%, to 8,761.56 points.

** The one-year loan prime rate (LPR) was lowered by 10 basis points, and the five-year LPR was reduced by 5 basis points — the first reduction since April 2020. ** The Hang Sang Tech Index surged 4.5% after China's cyberspace regulator denied issuing a document with new guidelines for the nation's leading internet companies that would require them to seek approval for new investments and fundraising.

** Shares of Chinese leading tech giants, also index heavyweights, such as Tencent Holdings, Alibaba Group and Meituan ended up 6.6%, 5.9% and 11%, respectively. ** Mainland developers listed in Hong Kong soared 4.6%, with Shimao Group and Sunac China Holdings up 12.1% and 15.2%, respectively.

** Reuters reported that China is drafting nationwide rules to make it easier for developers to access funds from sales still held in escrow accounts, in its latest move to ease a severe cash crunch in the sector. ** The Hang Seng Finance Index rose 2.5%, with insurer AIA Group gaining 5.8%. Consumer staples added 2.6%.