Hainan's Free Trade Port Sparks Surge in Chinese Markets

Chinese and Hong Kong stock markets surged on positive financial inflows and the establishment of a free trade port in Hainan. The blue-chip CSI300 Index rose, boosting market sentiment alongside accelerated fundraising by Chinese funds targeting the Hong Kong market. Potential beneficiaries soared, affirming Beijing's commitment to economic opening.

China and Hong Kong witnessed a rise in stock markets on Monday, buoyed by signs of sustained financial inflows and the inauguration of a free trade port in the tropical island of Hainan. China's blue-chip CSI300 Index increased by 0.8% by lunchtime, while the Shanghai Composite Index saw a 0.6% rise. In Hong Kong, the Hang Seng index climbed 0.2%.

The latest data highlights the expansion of China's private fund sector to a record 22.1 trillion yuan in November, driven by strong equity inflows. More than a dozen newly launched Chinese funds focusing on the Hong Kong market completed fundraising ahead of schedule, as investors rushed to seize buying opportunities.

Investor sentiment was further enhanced by a rise in Hainan stocks, following last week's initiation of the Hainan Free Trade Port, signaling Beijing's dedication to economic liberalization. Companies such as China Tourism Group Duty Free Corp and Hainan Airlines Holding Co Ltd experienced substantial gains, hitting their daily 10% limits.

(With inputs from agencies.)