Hong Kong shares rise on accelerating China factory activity as stimulus takes hold

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The widely watched Caixin factory gauge expanded for a second straight month to reach the highest level since June

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People walk by the Hong Kong stock exchange in Central. Photo: May Tse

Mia Castagnone

Published: 10:34am, 2 Dec 2024Updated: 4:40pm, 2 Dec 2024

Hong Kong stocks rose as sentiment perked up after China’s manufacturing activity jumped for a second month to a five-month high in November, indicating Beijing’s stimulus policies are taking effect.

The Hang Seng Index gained as much as 1.3 per cent, before ending the day 0.7 per cent higher at 19,550.29. The Hang Seng Tech Index advanced 1.2 per cent. On the mainland, the CSI 300 Index added 0.8 per cent and the Shanghai Composite Index gained 1.1 per cent.

Bottled water maker Nongfu Spring surged 8.3 per cent to HK$35.85, while drug maker WuXi Biologics jumped 3.3 per cent to HK$15.50. Casino operator Galaxy Entertainment added 1.6 per cent to HK$35.10 and rival Sands China gained 2.3 per cent to HK$20.30.

The Caixin/S&P Global manufacturing purchasing managers’ index (PMI) – a survey of sentiment among Chinese factory owners – rose to 51.5 in November from 50.3 the previous month, the highest since June. On Saturday, the official PMI came in at 50.3, beating market consensus and October’s reading of 50.1.

“The Hong Kong stock market responded cautiously to the PMI data, with the rally fizzling quite quickly,” said Louis Wong, executive director of Phillip Capital Management.