Hong Kong stocks saw a sudden spike in afternoon trading yesterday, with property shares leading the advance.
The Hang Seng Index rose 2% at the close as inflows from across the border continued for a seventh day. Before the advance, the gauge had fallen for three straight sessions. A measure of property stocks listed in the city increased 2.1%, the most since July 6.
Analysts saw no apparent reason for the surge. The Hang Seng Index has underperformed all year, entering the day down 13%.
Wharf Real Estate Investment Co. rose 7.5% to lead gains, while New World Development Co. and Hang Lung Properties Ltd. added at least 3.3%. The city’s home July sales rose 35% year-on-year in terms of value, the Land Registry said in a statement Tuesday. That’s the second monthly increase after declines in the January-May period.
The Hong Kong property gauge is trading at 8 times expected earnings over the next 12 months, compared to a peak of 27 reached in 2007.
The Hong Kong dollar hovered near 7.75 versus the greenback, which is the strong end of its trading band. MDT/Bloomberg
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