Shanghai stocks end at 3-month high despite hawkish Fed, COVID woes

Boc Hong Kong Holdings

14/06/2022 09:48

(Updates with Hong Kong closing levels)
    SHANGHAI, June 14 (Reuters) - Shanghai stocks closed at
three-month highs, while Hong Kong shares ended unchanged on
Tuesday, despite an overnight slump in U.S. stocks on fears of
aggressive U.S. rate hikes, as analysts expect China's growth to
rebound with more policy support.
    
    The blue-chip CSI300 index  .CSI300  rose 0.8% to 4,222.31,
while the Shanghai Composite Index  .SSEC  gained 1% to 3,288.91
points, after dropping as much as 1.8%.
    The Hang Seng index  .HSI  closed flat at 21,067.99, after
slumping as much as 1.7%, while the China Enterprises Index
 .HSCE  lost 0.1%, to 7,333.61 points.
    ** Wall Street hit a confirmed bear market milestone amid a
Goldman Sachs forecast of a 75-basis-point interest rate hike at
the Federal Reserve's policy meeting on Wednesday.  urn:newsml:reuters.com:*:nL1N2Y01WB
    ** "U.S. inflation has direct impact on A-shares, as we can
see from the performance in recent two days," said Wang
Mengying, a stock index futures analyst at Nanhua Futures.
"China stocks performance will eventually depend on expectations
of domestic economic recovery." 
    ** "However, if more aggressive rate hikes lead to less
aggregate global demand, domestic expectations would also be
hit."
    ** Authorities in China's capital Beijing are rushing to
contain a COVID-19 outbreak traced to a 24-hour bar, with a
health official saying the outbreak was "still
developing". urn:newsml:reuters.com:*:nL1N2Y00DU
    ** "I think the worst is actually behind us when it comes to
the Omicron variant"  said David Chao, global market strategist,
Asia Pacific (ex-Japan) at Invesco.
    ** "While we see growth challenged in the first half of
2022, we expect a rebound in the second half driven by a
combination of fiscal and monetary policy measures in contrast
with many Western developed countries."
    ** Foreign investors were net buyers of China stocks, with
Refinitiv data showing inflows of more than 7.1 billion yuan
($1.05 billion) through the Northbound leg of the Stock Connect
programme.  .NQUOTA.SH ,  .NQUOTA.ZK 
    ** Financials stocks jumped  .CSIFN  2.7%, with banks
 .CSI000951  adding 1.5%, while brokers  .CSI399975  soared
4.8%, and real estate developers  .CSI000952  gained 2%.
    ** Energy shares  .CSIEN  rose 2.3% and automobiles
 .CSI931008  finished up 3.3%.
    ** Tech gaints listed in Hong Kong  .HSTECH  edged down
0.1%, with index heavyweights Alibaba Group  9988.HK  down 2.5%
while Meituan  3690.HK  was up 3.3%. 
    ** BOC Hong Kong Holdings  2388.HK  led gains in local
banks, rising 4.8% to become the biggest percentage gainer in
the Hang Seng index.  urn:newsml:reuters.com:*:nL1N2Y10EV

 (Reporting by Shanghai Newsroom; Editing by Shailesh Kuber,
Louise Heavens and Uttaresh.V)
 ((Jason.Xue@thomsonreuters.com))