China, Hong Kong stocks extend rally on more stimulus

Chinese stocks rose again on Monday after posting their best weekly performance in nearly 16 years last week as Beijing rolled out new stimulus measures to halt a slowdown in the broader economy.

China’s central bank said late Sunday it would ask banks to cut mortgage rates for existing home loans by Oct. 31, as part of sweeping policies to support the country’s beleaguered property market.

Adding to efforts to reverse the housing crisis, the city of Guangzhou announced on the same day the lifting of all restrictions on home purchases, while Shanghai and Shenzhen eased purchasing restrictions.

That lit a fire in Chinese and Hong Kong stocks early on Monday, led by gains in real estate companies.

The blue-chip CSI300 index and the Shanghai Composite Index soared about 6 percent each, and mainland-listed real estate stocks rose more than 8 percent.

Hong Kong’s benchmark Hang Seng Index last traded 1.5 percent higher.

The CSI300 index soared nearly 16 percent last week and the broader Shanghai Composite Index jumped nearly 13 percent, both posting their biggest weekly gains since November 2008.

Similarly, the Hang Seng Index posted its biggest weekly gain since 1998 and the fifth-largest in the last half century.

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