By Laura He, MarketWatch
HONG KONG (MarketWatch) -- Hong Kong and Shanghai stocks continued to rally on Monday, shrugging off much weaker-than-expected Chinese export data.
Hong Kong’s Hang Seng Index /zigman2/quotes/210598030/delayed HK:HSI +2.20% pushed up 2.7% to 28,016.34, extending an eight-day winning streak, after a 7.9% jump last week. The index on Monday settled above 28,000 for the first time since December 2007. The mainland-China-tracking Hang Seng China Enterprises /zigman2/quotes/210598031/delayed CN:160462 +2.16% crept higher by 4.3%.
On the mainland itself, the Shanghai Composite Index /zigman2/quotes/210598127/delayed CN:SHCOMP +1.59% advanced by 2.2% to 4,121.71, its best close in more than seven years.
The gains came despite sharp falls in China’s imports and exports, announced earlier in the day. The nation’s exports fell 15% in March from a year earlier, widely missing projections of a 10% rise, official data showed. Imports fell 12.7% year-on-year in the same month, compared with a 12% estimated drop.
Hong Kong Exchanges & Clearing Ltd. /zigman2/quotes/200234512/delayed HK:388 +1.93% , the city’s sole bourse operator, soared 19.4%, after reports said China would increase daily quotas under the Hong Kong-Shanghai Stock Connect program for direct share-trading between the two markets. Currently, mainland investors can only buy 10.5 billion yuan ($1.7 billion) of Hong Kong stocks a day via the Stock Connect, while Hong Kong investors have a daily quota of 13 billion yuan.
Mainland bank China Merchants Bank /zigman2/quotes/209899244/delayed HK:3968 +6.51% spiked 24.8%, after it announced a massive employee stock-incentive plan over the weekend, raising up to 6 billion yuan ($960 million) through a private placement.
Meantime, shares of brokerage firms surged after China Securities Depository and Clearing Corp. said mainland investors would be allowed to open up to 20 stock-trading accounts, effective on Monday.
Haitong International Securities Group Ltd. leapt 22.8%, First Shanghai Investments Ltd. /zigman2/quotes/200726880/delayed HK:227 +1.35% soared 17.7%, and Guotai Junan International Holdings Ltd. /zigman2/quotes/203308570/delayed HK:1788 +1.45% cracked higher by 10.2%.
However, Hong Kong retailers retreated broadly after China announced a new internal visa policy Monday that will cut visits to Hong Kong by residents from the neighboring city of Shenzhen. Cosmetics chain store Bonjour Holdings Ltd. /zigman2/quotes/204727288/delayed HK:653 +3.05% sank 7.1%, and rival Sa Sa International Holdings Ltd. /zigman2/quotes/207386015/delayed HK:178 +0.54% slid 6.2%.
Other Asian markets were mixed, as Japan’s Nikkei Average /zigman2/quotes/210597971/delayed JP:NIK +0.51% nudged lower by less than 0.1%. The broader Topix /zigman2/quotes/210598092/delayed JP:180460 +0.51% edged down 0.2%, while the yen /zigman2/quotes/210561789/realtime/sampled USDJPY +0.1818% softened, with the greenback buying ¥120.74 compared with ¥120.30 in the previous session. Australia’s S&P/ASX 200 /zigman2/quotes/210598100/delayed AU:XJO +0.82% inched 0.1% lower. However, South Korea’s Kospi Composite Index /zigman2/quotes/210598069/delayed KR:180721 +1.09% added 0.5%.