Chinese stock futures rally in Hong Kong as HKEx surges

[beijng] Chinese stock futures in Hong Kong rallied on speculation the investor frenzy that has spurred world- beating gains for mainland equities is gravitating to the city.

The Hang Seng China Enterprises Index's April futures contract jumped 3.7 per cent to 13,987 at 9.21am The gauge of Chinese shares in Hong Kong, known as H shares, jumped 5.8 per cent yesterday for the steepest gain since December 2011.

Hong Kong Exchanges & Clearing Ltd soared 14 per cent in pre- market trading after the bourse reported record trading volume on Wednesday. CSI 300 Index April futures added 0.1 per cent to 4,249 today.

The Shanghai Composite Index closed 0.8 per cent higher at 3,994.81 after rising to as high as 4,000.22.

The index has doubled since January 2014 as traders borrowed a record amount of money to buy shares, new investors opened stock accounts at an unprecedented pace and government officials endorsed the rally. Chinese shares may have momentum to rise in the medium- to long-term after fluctuations, the official Xinhua News Agency said in an article on its website.

China will start to release March economic data on Friday, starting with inflation.

Consumer prices probably rose 1.3 per cent, slowing from a 1.4 per cent gain in February, while producer prices may have declined 4.8 per cent, unchanged from the previous month, according to the median estimate of a Bloomberg survey.

The Shanghai Composite is valued at 15.9 times 12-month projected earnings, compared with the five-year average multiple of 11, according to data compiled by Bloomberg. Its relative- strength index, measuring how rapidly prices have advanced or dropped during a specified time period, climbed to 83.9 on Wednesday, the highest since December 2014, signaling shares may be poised to fall.

BLOOMBERG