Hong Kong Stocks Jump Most in 15 Weeks

Hong Kong Stocks Jump Most in 15 Weeks

Bloomberg, (19/4) -- Hong Kong stocks rose, with the benchmark index gaining the most in more than 15 weeks, as Morgan Stanley upgraded the outlook for Hong Kong stocks and amid speculation that the Chinese government may widen the yuan’s trading band within the next three days. The Hang Seng Index gained 2.3 percent to 22,013.57 at the close, its biggest increase since Jan. 2. All but five stocks climbed on the 50-member gauge, with volume 18 percent above the 30-day average. For the week, daily turnover on the city’s stock exchange averaged HK$60.3 billion ($7.77 billion), 16 percent less than the daily average so far this year, according to data compiled by Bloomberg. The benchmark index ended the week 0.3 percent lower after almost erasing the losses of the previous four    trading days. The Hang Seng China Enterprises Index of Chinese companies listed in the city rose 2.1 percent to 10,483.60. “The turnover remains extremely low; I think this is only a technical factor,” said Alex Wong, a Hong Kong-based director at Ample Capital Ltd. “For Chinese banks, I think this is only a recovery after the earlier sell-off because they had been under severe pressure. If you compare the rebound today to the sell off earlier, it’s very minor.” Morgan Stanley raised its outlook for stocks in the MSCI Hong Kong Index to overweight, according to a report written by analyst Jonathan Garner, citing strong earnings revisions and undemanding valuations. China may expand the range within which it lets the yuan trade, timing the move during the Group of 20 nations meetings in Washington this week, UBS analysts Manik Narain and Geoffrey Yu wrote in a note after central bank Deputy Governor Yi Gang signaled policy makers will loosen control over the currency. The trading band will be widened “in the near future,” Yi said during the International Monetary Fund meeting April 17.