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HK stocks close higher, await Fed rate meeting

HONG KONG: Hong Kong stocks rose on Tuesday but were unable to recoup Monday's drop as investors waited to see what interest rate action the US Federal Reserve takes before buying back stocks that were battered on Monday.

The benchmark Hang Seng Index rose 0.78 percent or 121.52 points to end at 15,653.86, making up little of the 4.04 percent drop suffered on Monday when Hong Kong investors sold off after Wall Street tumbled on Friday.

Earlier in the day, the Hang Seng climbed as high as 15,764.40, after a strong rebound on Wall Street overnight boosted early buying. "People are waiting for the FOMC meeting and with a long holiday coming up they're not making a major commitment," said Antony Mak, sales director at Vickers Ballas Hong Kong Ltd.

"I'm not expecting much action over the next couple of days if it's a quarter (percentage) point hike."

The Federal Open Market Committee (FOMC) meets on Tuesday and Wednesday. The Federal Reserve is widely expected to raise interest rates by 25 basis points, with an outside chance of a more aggressive 50-basis-point rate hike, analysts said.

Hong Kong markets will be closed on February 4 and 7 for the Chinese New Year holiday.-Reuters