Hong Kong stocks hit an almost four-year high on Monday as investors priced in positive signs of an imminent cut in interest rates by the United States Federal Reserve.
The benchmark Hang Seng Index rose 2.08 percent, or 527.35 points, to close the morning session at 25,866.49. The Hang Seng TECH Index, which represents the 30 largest technology companies listed in the special administrative region, advanced 3.10 percent to 5,822.51 points, while the Hang Seng China Enterprises Index surged 2.05 percent to 9,266.29 points.
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Capital markets are interpreting US Fed Chair Jerome Powell’s speech on Friday as having opened the door to lower interest rates next month.
Cheaper borrowing costs would generally be a boon for risky assets, lifting stock prices.
Investors were banking on a more than 87.3-percent chance of a rates reduction in September following Powell’s remarks – up from 84.7 percent a day earlier — according to the CME Group’s FedWatch tool, which forecasts rate movements based on Fed funds futures trading data.
READ MORE: HK stocks defy selloff in US market
Labubu maker Pop Mart International, China Telecom and JD Logistics, all of which will be added to the HSI on Sept 8, continued to gain ground on Monday.
Pop Mart closed the morning session at an all-time high of HK$325 ($41.66), China Telecom edged up 0.81 percent at HK$6.23, and JD Logistics soared 7.62 percent to HK$13.98.
Contact the writer at sophialuo@chinadailyhk.com
