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China, Hong Kong: Stocks jump to 3-month highs on upbeat China trade data
[SHANGHAI] Leading share indexes in China and Hong Kong jumped over 2 per cent to three-month highs on Wednesday morning, after better-than-expected China trade data raised hopes that the country's economic slowdown was over.
Energy shares led the way as global oil prices surged to the highest level in 2016 in overnight trading.
Both China's blue-chip CSI300 index and the Shanghai Composite Index advanced 2.1 per cent by the lunch break, to 3,285.53 points and 3,086.51 points, respectively.
In Hong Kong, the Hang Seng index added 2.4 per cent, while the Hong Kong China Enterprises Index gained 3.6 per cent.
China's March exports blew past analyst expectations, rising 11.5 per cent from a year earlier, the first increase since June and the largest rise since February 2015. Imports fell by 7.6 per cent from a year earlier, less than expected.
China's trade data is "significantly higher than expected in March, which could continue to boost the risk sentiment in the short term," wrote Zhou Hao, economist at Commerzbank AG.
"Meanwhile, the market has also priced in some upside surprise in China's Q1 GDP figures to be released this Friday morning." The upbeat trade data, which followed a moderate expansion in the service sector in March, and rises in January-February industrial profits and PMI, offered fresh signs that China's economy could be stabilizing.
Reflecting the improving outlook for China's economy, the International Monetary Fund (IMF) on Tuesday nudged up forecasts for China's growth this year, even as it trimmed the outlook for the world as a whole.
Stocks rose across the board in China and Hong Kong. But reflecting narrowing price differences, an index tracking price premiums of mainland shares over their Hong Kong-listed counterparts stayed on track to fall for the sixth session in a row.
Energy shares were bullish on Wednesday, with an index tracking the sector in Hong Kong surging 5 per cent to a five-month high, helped by jumps in oil heavyweights including Sinopec, PetroChina and CNOOC.
The energy sector on the mainland was up 3.4 per cent.
Resources shares were also strong, inspired by a rally in global commodity prices as investors bet China's tentative economic recovery would spur demand for materials including steel, copper and aluminium.