Hong Kong stocks closed on Friday at a seven-year high, posting their biggest weekly gain in more than three years, as the city's bourse expects investment quotas for mainland investors to rise by over 30 per cent to accommodate heavy capital inflows.
The Hang Seng index rose 1.2 per cent, to 27,272.39, bringing the week's gain to 7.9 per cent.
The China Enterprises Index gained 1.7 per cent, to 13,987.53 points, and produced a weekly gain of 10.5 per cent.
On Friday, mainland investors used about half of the 10.5 billion yuan ($1.69 billion) daily quota for Hong Kong shares under the Shanghai-Hong Kong Stock Connect scheme. The quotas were fully taken up on Wednesday and Thursday.
Hong Kong Exchanges and Clearing Ltd (HKEx) Chief Executive Charles Li told reporters on Friday that regulatory authorities have been discussing raising the quotas for a while.
"Firstly there definitely will be quota expansion and secondly the expansion will not simply be 20 or 30 per cent," Li said.
Among the most actively traded stocks on Hong Kong's main board on Friday were CCT Land, down 5.3 per cent to HK$0.02; GOME, up 11.5 per cent to HK$2.03 and SMIC, unchanged at HK$0.93.
Total trading volume of companies included in the HSI index was 3.4 billion shares.