February 25, 2020 / 8:56 AM / a month ago

Hong Kong stocks recover on expectation of limited virus impact

Feb 25 (Reuters) - Hong Kong stocks recovered from early falls to close slightly higher on Tuesday, as investors expected the coronavirus outbreak outside China to have a limited impact on the world’s second-largest economy.

** The Hang Seng index rose 0.3%, to 26,893.23, while the China Enterprises Index gained 0.1%, to 10,579.92.

** South Korea aims to test more than 200,000 members of a church at the centre of a surge in coronavirus cases while the United States pledged $2.5 billion to fight the disease, as it spreads rapidly beyond China’s borders to Europe and the Middle East. ** In the short term, the panic sentiment brought about by the virus contagion outside China could have relatively limited impact on China’s capital markets, given the situation here has already turned better as Beijing took powerful measures, private equity firm STAROCK said in a report. ** Chinese policymakers have implemented a raft of measures to support an economy jolted by a coronavirus outbreak that is expected to have a devastating impact on first-quarter growth. ** A continued drop in new cases outside Hubei also helped lift sentiment. ** China reported a rise in new coronavirus cases in Hubei province, the epicentre of the outbreak, on Tuesday while the rest of the country saw a fourth straight day of declines. ** Regions deemed low risk from the outbreak should fully resume normal activities and end transportation bans, an official at China’s state planning agency said. ** Stocks were also underpinned by robust southbound flows, as mainland investors on Tuesday net bought nearly 5 billion yuan worth of Hong Kong stocks via the Stock Connect. (Reporting by the Shanghai Newsroom; Editing by Subhranshu Sahu)

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