Hong Kong stocks boosted by US rate cut hopes, EV makers surge as EU divided on tariffs
- US data released overnight supported the case for a rate cut while Federal Reserve minutes of June’s meeting showed officials felt ‘price pressures were diminishing’
The Hang Seng Index gained 0.3 per cent to 18,028.28 at the close of trade on Thursday. The Tech Index added 0.6 per cent on the back of the 2.5 per cent gain posted on Wednesday, while the Shanghai Composite Index declined 0.8 per cent.
Search engine operator Baidu gained 1.3 per cent to HK$87.30 and e-commerce site operator Alibaba climbed 1.3 per cent to HK$73.15, leading advances among tech heavyweights. Online travel agency Trip.com jumped 4.4 per cent to HK$395.60 while food delivery platform Meituan advanced 2.2 per cent to HK$119.70.
Electric vehicle maker BYD added 1.9 per cent to HK$234.60 and rival Li Auto surged 3.9 per cent to HK$80.80, after a Reuters report that the German car industry had urged the EU to drop additional tariffs on China EVs.
Sentiment was buoyed by US data released overnight that supported the case for a US interest rate cut. Meanwhile Federal Reserve minutes of June’s meeting showed that officials felt “price pressures were diminishing”. Chances of a 25 basis point cut in interest rates at the Fed’s September meeting rose to 67 per cent from 51 per cent a month ago, according to CME Fedwatch tool.
“The liquidity situation of Hong Kong stocks is expected to improve further,” Melody Lai, chief strategist at Shanghai Pudong Development Bank in Hong Kong, said in a note. Global funds are set to flow into emerging markets ahead of the Fed’s easing cycle, while stepped-up purchases by onshore investors also boded well for the market, she added.
