On the back of a series of supportive measures, investors are increasing their bets on the stock market
Hong Kong stocks end flat
Hong Kong stocks have closed flat after worse-than-expected Chinese economic data was balanced by gains for telecoms companies.
A report showed China’s foreign direct investment (FDI) slumped to a two-year low, adding to a series of downbeat data about the world’s second largest economy.
Hong Kong’s Hang Seng Index ended up 0.52 points at 24,955.46 on turnover of $HK69.68 billion ($A9.73 billion) on Monday, recovering from a dismal start as tensions between Ukraine and Russia also weighed on investors.
Phone operators made strong gains, building on a surge last week, with China Unicom rising 3.72 per cent.
China Mobile, the world’s biggest mobile operator by subscribers, closed up 3.16 per cent after leaping 5.78 per cent on Friday.
Chinese telecoms stocks have been boosted by reports that Beijing is establishing a national company that will build and run a string of cellular towers, saving operators huge capital costs.
On the Chinese mainland investors shrugged off the gloomy data, with Shanghai hitting an eight-month high.
The Shanghai Composite Index rose 0.57 per cent, or 12.74 points, to 2,239.47 — its highest close since December 5 last year — on turnover of 141.5 billion yuan ($A24.89 billion).
The Shenzhen Composite Index, which tracks stocks on China’s second exchange, jumped 1.46 per cent, or 17.55 points, to 1,218.73 on turnover of 180.1 billion yuan.
Analysts said traders had largely ignored Monday’s poor FDI data, placing their hopes on government policies aimed at revitalising the world’s second biggest economy, such as measures to lower financing costs for smaller companies.
“On the back of a series of supportive measures, investors are increasing their bets on the stock market,” said Capital Securities analyst Li Bin.
“They believe that it’s just the beginning of a bull market.
“These measures have largely offset the concerns about a slowing economy. Investors are more focused on seeking stocks that will benefit from China’s economic reforms,” Li added.
Chinese media companies made some of the biggest gains of the day, with traders anticipating that the sector will receive a financial boost from the government.
People.cn, the website of the official People’s Daily newspaper, surged by the 10 per cent daily limit, as did Zhejiang Daily Media.
The upswing came despite news that China’s FDI fell 16.95 per cent in July to $US7.81 billion — its lowest since July 2012.
The government denied there was any link to Beijing’s multiple probes into foreign companies, which have raised concerns among investors that overseas firms are being targeted.
Chinese authorities have in recent months launched anti-monopoly, pricing and other inquiries into foreign firms in sectors ranging from auto manufacturing and pharmaceuticals to baby milk.
But commerce ministry spokesman Shen Danyang denied any connection between the investigations and the fall in FDI.
“Foreign companies will not be scared away by investigations into the cases,” Shen said.
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