Shanghai and Hong Kong Stocks Reach New Heights Amid Easing Pressures

Mainland China and Hong Kong stocks surged, driven by signs of easing deflationary pressures and market expectations for additional stimulus. The Shanghai Composite index reached a high of 4,120.43 points, with investor optimism focusing on Chinese equities' potential earnings growth. Trade and credit lending data are awaited for further economic insights.

The stock markets in Mainland China and Hong Kong recorded gains on Friday, with the Shanghai Composite reaching a decade peak amid improving investor sentiment.

China's December consumer price inflation hit a 34-month high, yet producer price deflation remained, supporting expectations of further stimulus measures to boost demand.

Analysts maintain a positive outlook on Chinese equities, buoyed by expectations of balanced domestic demand and policy support, though they favor certain sub-industries over direct consumer-facing sectors.

(With inputs from agencies.)