Hong Kong, Shanghai stocks boosted by Li pledge

Hong Kong shares closed 0.53 percent higher Monday, while Shanghai surged to a five-year high after Chinese Premier Li Keqiang said the government was ready to support the economy if it slows took much.

Hong Kong's benchmark Hang Seng Index added 126.34 points to 23,949.55 on turnover of HK$73.16 billion ($9.44 billion).

The market extended gains from the end of last week after Li told his annual news conference Sunday there was ample room for stimulus to kickstart the world's number two economy.

As the National People's Congress wrapped up, he told reporters: "We still have a host of policy instruments at our disposal."

His comments eased concerns about growth, which last year was the slowest since 1990 and is expected to continue struggling this year, albeit at a rate of about seven percent.

Authorities have cut interest rates twice since November and also reduced the amount of cash banks must keep in reserve in a bid to boost lending.

"Li's positive tone on growth bolstered investor confidence," Yen Chiu, a trader at Shenwan Hongyuan Group Co. in Hong Kong, told Bloomberg News.

The news trumped another loss on Wall Street, where the three main indexes were hit Friday by falling oil prices and wariness ahead of this week's Federal Reserve meeting.

The Dow lost 0.82 percent, the S&P 500 dropped 0.61 percent and the Nasdaq shed 0.44 percent.

In Hong Kong China Mobile rose 2.70 percent to HK$102.60, insurance giant AIA gained 1.39 percent to HK$47.30 and Tencent added 1.50 percent to HK$135.60.

Energy firms took a hit as oil prices sank to six-year lows. CNOOC lost 0.58 percent to HK$10.28, PetroChina shed 0.36 percent to HK$8.21 and Sinopec gave back 0.16 percent to HK$6.14.

In mainland China the benchmark Shanghai Composite Index jumped 2.27 percent, or 76.40 points, to 3,449.31 -- its highest close since August 2009 -- on turnover of 479.4 billion yuan ($77.8 billion).

The Shenzhen Composite Index, which tracks stocks on China's second exchange, surged 3.05 percent, or 52.11 points, to 1,760.19 on turnover of 418.5 billion yuan.

"Investors chased thematic stocks on Premier Li's supportive tone," Zheshang Securities analyst Zhang Yanbing told AFP. "Funds unlocked from last week's new share subscriptions may help Shanghai rally further."

Companies launched 23 initial public offerings last week, with funds from unsuccessful subscriptions expected to return to the market this week.

China Southern Airlines surged by its 10 percent daily limit to 7.11 yuan in Shanghai and China Eastern Airline jumped 7.39 percent to 6.39 yuan.

Shanghai-listed software developer Hundsun Technologies soared 9.15 percent to 98.15 yuan and Shenzhen-listed corporate website developer Zhejiang Netsun surged by its 10 percent daily limit to 87.76 yuan.

But Shenzhen-listed FAW Car fell 1.92 percent to 18.90 yuan on Monday after news that the top executive of its parent company is under investigation for alleged corruption.