Hong Kong's stock benchmark climbed the most in two weeks yesterday after the United States Federal Reserve said it will inject US$200 billion into the US financial system to revive lending among banks and try to avert a recession.
HSBC Holdings Plc closed at its highest in two months. Li and Fung Ltd, which sells goods to Wal-Mart Stores Inc, reached its best close in more than a week.
Almost three stocks on the 43-member Hang Seng Index advanced for each one that dropped, Bloomberg News said.
Hang Lung Properties Ltd, a Hong Kong-based developer with operations in China's mainland, led gains among property stocks.
It climbed HK$1.65, or 6.5 percent, to HK$27.10, its biggest jump since January 25. Sun Hung Kai Properties Ltd, Hong Kong's No. 1 developer by market value, added HK$4.80, or four percent, to HK$124.60, its steepest advance since February 26.
Investors judged as excessive the recent declines that dragged the Hang Seng Property Index 24 percent lower this year, the worst-performing industry group on the Hang Seng Index.
"Markets needed the liquidity," said Jing Ulrich, chairwoman of China equities at JPMorgan Chase and Co in Hong Kong. "The injection has given markets a boost."
The Hang Seng added 427.41, or 1.9 percent, to close at 23,422.76. The Hang Seng China Enterprises Index, which tracks the Hong Kong-listed shares of Chinese companies, climbed 2.3 percent to 12,877.35. Both gauges climbed the most since February 27.
HSBC, Europe's biggest bank, climbed HK$2.30, or 1.9 percent, to HK$125.20, its best close since January 10.
Li and Fung added 80 cents, or 2.8 percent, to HK$29, its best close since February 29.
On Tuesday, the US Standard and Poor's 500 Index climbed 3.7 percent, the most since October 2002.
The Fed will for the first time lend Treasuries in exchange for debt that includes mortgage-backed securities. The effort was coordinated with central banks in Europe and Canada, which plan to inject up to US$45 billion into their banking systems.