Hang Seng surges into June on investor relief

Business | Agencies and Winnie Lee 2 Jun 2020

The night futures of the Hang Seng Index were generally flat after the benchmark HSI surged 771.05 points to 23,732 on the first trading day in June, capping its best day in more than two months.

Investors expressed relief that US President Donald Trump did not immediately end US special privileges accorded to Hong Kong, based on speculation that Washington won't take extreme steps in response to China's crackdown on the city.

While Trump's speech on Friday featured strong words, it lacked any specifics regarding measures to be taken against the SAR.

"Trump's comments gave no immediate measures on Hong Kong and leave room for negotiations with Beijing," said Castor Pang, head of research at Core Pacific-Yamaichi International. "Trump's comments have eased investors' concern about the impact of potential sanctions on the Hong Kong economy."

The HSI closed 3.4 percent higher, led by real estate firms, after falling almost 7 percent last month.

Meanwhile, Hong Kong Exchange and Clearing (0388) may extend trading hours for futures, with possible options to trade during public holidays. Head of markets Wilfred Yiu said the HKEX had looked into multiple measures to strengthen the futures and options market, including extending the daily trading hours and transactions available during public holidays. Yiu said the 37 MSCI index futures and options would be launched in the third quarter if the products receive approval.

Shares of Hong Kong Exchange and Clearing rose 4.66 percent yesterday.

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