Hang Seng gains 1.2% on stimulus and rate cut hopes

The Hang Seng surged 237 points, or 1.2%, to close at 19,523 on Thursday, marking its third consecutive day of gains following a Wall Street rally.

Hang Seng gains 1.2% on stimulus and rate cut hopes

This rise was driven by growing expectations of potential Federal Reserve rate cuts this year after a slowdown in US core inflation. The index reached its highest level in a week, recovering from a nearly four-month low last week. Chinese state media reported that the central bank may cut the reserve requirement ratio (RRR) for commercial banks ahead of the Spring Festival to boost liquidity in the sluggish economy. Despite concerns over the US tightening tech controls by adding more Chinese entities to its restricted trade list, investors largely shrugged off the issue.

Caution limits gains; China Hongqiao, Geely lead

However, caution limited gains ahead of key data releases on Friday, including China's Q4 GDP and December retail sales and industrial output figures. All sectors saw gains, with financials, technology, and consumer stocks leading. Top performers included China Hongqiao Group (+5.3%), Geely Auto (+3.7%), Techtronic Industries (+2.6%), and AIA Group (+2.3%).