Hong Kong stocks extended their bounce on Thursday morning, tracking global markets as post-Brexit fears eased, but Chinese shares dipped from three-week highs on profit-taking.
Hong Kong’s Hang Seng index added 1.6 percent, to 20,762.40 points, while the Hong Kong China Enterprises Index gained 1.5 percent, to 8,702.31.
China’s blue-chip CSI300 index was slightly lower at 3,150.45 points by the lunch break, while the Shanghai Composite Index lost 0.2 percent, to 2,924.47 points.
Overnight, the Dow rose 1.6 percent while Britain’s FTSE rallied for the second day, as global markets regained some composure after last week’s Brexit shock.
In a sign of increasing confidence among mainland investors, outstanding margin loans – money investors borrowed from brokerages to buy stocks – rose for three days in a row on Wednesday.
But as the market hit three-week highs, selling-pressure has increased, with analysts saying there’s not enough positive catalysts in sight to justify a sustainable rally.
On Thursday morning, weakness in resources, infrastructure and transportation sectors offset gains in consumer and healthcare shares.
But in Hong Kong, all main sectors rose, with financial and property shares leading the gains.
Hong Kong-listed shares of China Vanke, which fell to 1-1/2 year lows on Wednesday amid a deepening power struggle between management and major shareholders, rebounded sharply on Thursday morning, as some investors viewed the drop as excessive.