HONG KONG—Hong Kong stocks advanced Friday, boosted by Wall Street's rise overnight to levels not seen since January.
The blue chip Hang Seng Index rose 486 points, or 1.89 percent, to 26,241.02. Traders said the local benchmark index has been boosted recently by stabilization in China's stock exchanges, as well as by a more positive outlook for the U.S. economy.
On Wall Street Thursday, the Dow Jones industrial average rose 1.5 percent to 13,010 -- the first time it has closed above the 13,000-point level since Jan. 3. The climb followed the U.S. Federal Reserve's cut of its benchmark interest rate to 2 percent.
Some investors believe the cut -- smaller than earlier, more aggressive reductions -- may signal the Fed is near the end of its rate-cutting cycle.
"A rebound in the dollar and retreating oil prices helped to calm fears about inflation in the U.S., renewing investors' appetite for equities," said Y.K. Chan, a strategist at Phillip Asset Management Ltd. "It seems liquidity is heading from the commodities markets to the stock markets."
CIMB Securities Ltd. said in a research note it expects some profit-taking in the near term, but "we feel the downside for the market will be limited as several positive factors are supporting the share prices."
Those factors include better-than-expected first-quarter results from Chinese banks, easing inflation in China and the mainland's stabilizing markets, CIMB said.
Most blue chips ended higher, and recently lagging property firms rose on bargain hunting.
Sino Land soared 9.1 percent to 21.50 Hong Kong dollars, New World Development ended 6.5 percent higher at HK$21.40, and Sun Hung Kei Properties rose 2.9 percent to HK$140.50.
China Mobile, the largest blue chip by capitalization, rose 2.4 percent to HK$136.10.
Downstream oil refiner Sinopec rose 5.1 percent to HK$8.69 and airline company Cathay Pacific gained 4.4 percent to HK$16.98 on lower crude oil prices.
June crude oil futures in electronic trading on the New York Mercantile Exchange were near $113 a barrel late Friday in Asia, sharply down from a record near $120 a barrel at the beginning of the week.
China Netcom rose 5.3 percent to HK$24.75 on renewed speculation about an imminent restructuring in China's telecommunications sector.
The Hong Kong stock market was closed Thursday for the Labor Day holiday.
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On the Net:
Stock Exchange of Hong Kong: http://www.hkex.com.hk
