HONG KONG, China — European luxury goods stocks and Asia-exposed banks rallied Wednesday following a report that Hong Kong Chief Executive Carrie Lam plans to formally withdraw the extradition bill that has caused months of protests in the city.
The South China Morning Post reported Lam’s intentions, citing people it didn’t identify. The bill had already been suspended, but an official withdrawal is among key demands of pro-democracy protesters. Local stocks surged and the Hong Kong dollar jumped on the news.
In Europe, luxury goods names rose on the news, given the reliance the industry has on sales to Chinese consumers visiting Hong Kong. Swatch Group AG and Cie Financiere Richemont SA, two of the companies cited by analysts as the most exposed to the disruptions, were higher. Kering SA, LVMH SE, Moncler SpA and Hugo Boss AG all rose, making retail among the top-performing Stoxx 600 sectors in early trading.
Other Hong Kong-exposed stocks also benefited. HSBC Holdings Plc and Standard Chartered Plc, which both have a major presence in the Hong Kong market, gained at least 2.3 percent. Shares in Prudential Plc, the UK insurer which gets more than half its revenue from Asia, rose as much 4.9 percent, the most intraday since December.
By Sam Unsted; editors: Beth Mellor and John Viljoen.