Hong Kong stocks close at 5-month high

Despite large-scale protests throughout the year in the island territory, Hong Kong's stocks closed at a 5-month high
Last Updated 30 December 2019, 11:00 IST

Hong Kong shares tracked strength on the mainland to close at an over five-month high on Monday after China's central bank said it will switch the benchmark for floating-rate loans, a move that could help lower funding costs.

The Hang Seng index closed up 0.3% at 28,319.39, its highest since July 26, while the China Enterprises Index gained 0.3% to 11,225.31.

China's central bank will use the loan prime rate (LPR) as a new benchmark for pricing existing floating-rate loans, in a step that analysts say could also underpin economic growth.

"The purpose of the step is to make interest rates more market-driven and help lower financing costs," said Wen Bin, an economist at Minsheng Bank in Beijing.

On the trade front, China's commerce ministry has "proactively dealt with" trade frictions with the United States this year, it said on Sunday after an annual work conference.

Hong Kong will end 2019 with multiple protests planned for New Year's Eve and New Year's Day, aimed at disrupting festivities and shopping in the Asian financial hub, which has seen a rise in clashes between police and protesters since Christmas.

Around the region, MSCI's Asia ex-Japan stock index was firmer by 0.07%, while Japan's Nikkei index closed down 0.76%.

The yuan was quoted at 6.9859 per U.S. dollar by 0814 GMT, 0.14% firmer than the previous close of 6.9956.

At close, China's A-shares were trading at a premium of 26.31% over Hong Kong-listed H-shares.

(Published 30 December 2019, 09:58 IST)

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