May 27, 2010 (Chinavestor) Chinese shares rallied in Asia on Thursday after Morgan Stanley suggested China stocks are undervalued. Europe's debt crisis made Chinese policy makers to rethink the exit from the stimulus package, suggesting an easing policy is here to stay. The Hang Seng Index (INDEXHANGSENG:.HSI) advanced 234.9 points or 1.2% to 19,431.37 points while the Shanghai Composite Index (SHA:000001) rose 30.1 points or 1.1% to 2,655.92.
The rally was universal in both Asian markets; each and every component of the SSE-50 Index, tracking the largest listed Chinese companies in Shanghai, advanced and only tow out of the 42 member Hang Seng Index components ended the day in the red.
Index futures point to a higher open ahead the bell. Oil is up 2.38% to $73.21 bouncing off previous lows in the high $60s, suggesting a positive market day is ahead for energy, solar and coal stocks. CNOOC Ltd. (HKG:0883) (NYSE:CEO) advanced 3.9% in Hong Kong earlier the day. Shares of Yanzhou Coal (HKG:1171) jumped 7.2% in Hong Kong on Thursday.
GigaMedia Limited (NASDAQ:GIGM) reported earnings before the open; revenues and earnings disappointed and investors grilled the management during the Q&A session.