Hong Kong stocks rallied on Thursday, buoyed by growing hopes that a deal to avert a U.S. debt default was within reach. The Hang Seng Index climbed sharply as investors reacted positively to signs of progress in Washington.

Optimism surrounding a potential resolution to the U.S. debt ceiling crisis fueled buying interest across various sectors. Financial stocks, in particular, saw strong gains, contributing significantly to the overall market upswing.

Analysts noted that the positive momentum in Hong Kong was largely driven by external factors, specifically the developments in the U.S. debt negotiations. A successful agreement in the U.S. is expected to have a stabilizing effect on global markets, benefiting Hong Kong’s open economy.

However, some cautioned that the rally could be short-lived if the U.S. debt situation remains unresolved. Investors are advised to remain vigilant and monitor the situation closely.

Key highlights of the day’s trading included:

• The Hang Seng Index recorded a substantial increase.
• Financial stocks led the gains.
• Market sentiment was heavily influenced by U.S. debt deal hopes.

The market’s performance underscores the interconnectedness of global financial markets and the sensitivity of investor sentiment to political and economic developments in major economies.