Hong Kong stocks rise after Fed chief's rate-cut signals

The Hong Kong stock market ended higher on Thursday, tracking gains in broader Asia, after U.S. Federal Reserve Chairman Jerome Powell set the stage for an anticipated interest rate cut later this month.

At the close of trade, the Hang Seng index was up 0.8% at 28,431.80. The Hang Seng China Enterprises index also rose 0.8%. The sub-index of the Hang Seng tracking energy shares rose 1.9%, the IT sector eased 0.3%, the financial sector ended 0.8% higher and the property sector rose 1.1%. The top gainer in Hang Seng was Sunny Optical Technology Group Co Ltd, which gained 3.2%, while the biggest loser was Geely Automobile Holdings Ltd, down 1.5%. Fed's Powell on Wednesday paved the way for the first U.S. interest rate cut in a decade later this month, pledging to "act as appropriate" to defend an economic expansion threatened by trade disputes and a global slowdown. The Hong Kong Dollar is pegged to the greenback at a tight range of 7.75-7.85 and its base rate moves lockstep with U.S. rates. Powell's remarks sent stocks higher around the region. MSCI's Asia ex-Japan stock index was firmer by 0.8%, while Japan's Nikkei index closed up 0.5%. China will release its second-quarter gross domestic product (GDP) data on Monday, July 15. Growth is expected to slow to a near 30-year low of 6.2% this year, a Reuters poll showed on Wednesday, despite a flurry of support measures to spur domestic demand to offset the trade war's impact. Some economists said they expected Beijing to roll out more stimulus soon to ward off a sharper slowdown. Analysts say the Chinese central bank could cut its benchmark policy rate for the first time in four years if the Fed delivers a widely expected cut, as Chinese policymakers step up support for the slowing economy. About 1.1 billion Hang Seng index shares were traded. The volume traded in the previous trading session was 1.04 billion. At close, China's A-shares were trading at a premium of 27.7% over Hong Kong-listed H-shares.

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