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Hong Kong stocks rose from near a three-month low after government reports showed China's economic activity strengthened this quarter, while consumer spending rebounded after the end of zero-Covid policy. Concerns about the fallout from the collapse of Silicon Valley Bank eased on state backstop.
The Hang Seng Index rose 1.5 per cent to 19,539.87 at the close of trading, after sliding yesterday to the lowest level since December 21. The Tech Index jumped 1.9 per cent while the Shanghai Composite advanced 0.1 per cent.
Baidu surged 3.6 per cent to HK$133.60 before launching its ChatGPT-like bot later this week. NetEase surged 3.7 per cent to HK$134, while JD.com rose 2.4 per cent to HK$159.20 and Meituan added 1 per cent to HK$126.70. WuXi Biologics climbed 1.6 per cent to HK$50.65.
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Industrial production in mainland China rose 2.4 per cent in the first two months this year from a year earlier, the statistics bureau said on Wednesday, versus a 1.3 per cent expansion in December. Retail sales rose 3.5 per cent, recovering from a 1.8 per cent decline in December, it added.
The reports reassured investors, following the market's disappointment with China's growth targets for 2023 unveiled during the National People's Congress earlier this month. The Hang Seng Index has slumped 13.9 per cent from its peak this year on January 27, while the city's broader market lost US$490 billion of capitalisation, according to Bloomberg data.
"The retail and industrial data was in line with market expectation and is a sign that China's reopening and economic growth is on track," said Linus Yip, chief strategist at First Shanghai Securities in Hong Kong. Investors will need to monitor key data to assess post-reopening benefits, he added.
Elsewhere, Alibaba Group, the owner of this newspaper, jumped 2.6 per cent to HK$82.05 after the group signed a pact with the market regulator in Hangzhou. Ping An Insurance (Group) surged 3.1 per cent to HK$52.25. China's largest insurer is due to report its earnings later today. Net profit probably rose 1 per cent in 2022, according to market consensus from analysts compiled by Bloomberg.
China's growth momentum is set to improve further in the coming months, driven mainly by ongoing consumption recovery and still-accommodative macro policy, Goldman Sachs said in a research note on Wednesday.