Hong Kong stocks correct after two days of losses

<p>Political considerations continue to weigh on investors’ minds.</p>

Hong Kong stocks rebounded on Wednesday (June 17th) after two down days, though the market had a cautious undertone given that legislators are soon to debate an electoral reform plan that may reignite protests. 

Sentiment was positively impacted by news that the reform plan proposed by Bank of Communications (Bankcomm) was approved by the Chinese State Council, leading to hopes that other Chinese SOE’s may follow suit. 

On the negative side, there was some trepidation following news that the highly anticipated Hong Kong Shenzen Connect may be delayed until next year. 

Chinese listed stocks may continue to suffer from an outflow of investors’ funds chasing the flood of IPOs in the pipeline this week - estimated to soak up ¥7 trillion (£708 trillion) of capital, according to Reuters.

Indices and sectors

The benchmark Hang Seng Index gained 187.09 points, or 0.7 per cent, and closed at 26,753.79, recording a turnover of HK$120.82 billion (£9.8 billion). 

The Hang Seng China Enterprises Index was up 161.90 points, or 1.22 per cent, to 13,414.83. Turnover amounted to HK$23.65 billion.

On the Chinese mainland, the SSE Composite gained 80.47 points, or 1.65 per cent, at 4,967.90. 

The HIS Finance sector gained 0.80%, Properties was up 0.73 per cent and Commercial & Industrial rose 0.6 per cent. However, Utilities fell 0.01 per cent.

Stocks

In the financial sector, the Bank of China (+2.16 per cent, $5.21), Bankcomm (+1.66 per cent, $7.94), China Life Insurance (+1.61 per cent, $34.75), Ping An Insurance (+1.28 per cent, $111.00) and BOC Hong Kong (+1.25 per cent, $32.35) were the top gainers. However, HSBC Holdings (-0.14 per cent, $71.85) and Hang Seng Bank (-0.20 per cent, $152.50) lost ground.

In properties, Henderson Land (+1.98 per cent, $53.80), Sino Land (+1.08 per cent, $13.14) and China Resources Land (+1.03 per cent, $24.55) figured in the list of top gainers. China Overseas lost 0.53 per cent to $27.95.

In the commercial and industrial sector, Want Want China (+3.08 per cent, $8.38), Cathay Pacific Air (+2.48 per cent, $19.02), China Petro and Chemical (+2.23 per cent, $6.43), Galaxy Ent (+1.96 per cent, $33.80) and Lenovo Group (+1.84 per cent, $11.06) were the top winners. A prominent loser was CNOOC (-1.42 per cent, $11.10).

In utilities, China Resources Power (+0.70 per cent at $21.45) was the top gainer, while CLP Holdings (-0.54 per cent, $64.50) lost the most.

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