The benchmark Hang Seng Index added 170.05 points, or 0.70 percent, to 24,522.63 on turnover of HK$99.46 billion (US$12.83 billion).
In mainland China, the benchmark Shanghai Composite Index rose 0.59 percent, or 19.73 points, to 3,343.34 on turnover of 407.9 billion yuan ($65.7 billion).
The index jumped 4.74 percent on Wednesday, the biggest one-day rise since October 2009, and it has recovered almost all the losses it made on Monday in reaction to a regulatory crackdown on margin trading.
The Shenzhen Composite Index, which tracks stocks on China’s second exchange, gained 1.19 percent, or 17.99 points, to 1,530.28 on turnover of 288.4 billion yuan.
Eyes are firmly on the ECB meeting later Thursday, with expectations high that the central bank will unveil a programme of asset-purchasing, or quantitative easing (QE).
Speculation has been rife for several months that more stimulus would be announced as inflation continues to weaken — last month prices actually fell in December for the first time in five years.
China’s market regulator, the China Securities Regulatory Commission (CSRC), on Friday punished 12 brokerages for breaching rules for margin trading, which helped the Shanghai index to rally more than 50 percent last year.
“The market has basically digested the negative news from the CSRC last Friday,” Central China Securities analyst Zhang Gang told AFP.
Worries over liquidity capped gains, even though the central bank said late Wednesday that it had rolled over a 269.50 billion yuan medium-term lending facility for banks and provided an additional 50 billion yuan in loans to commercial and rural lenders.
But China’s central bank chief Zhou Xiaochuan also told the Davos forum on Wednesday that the People’s Bank of China (PBoC) does not intend to provide too much liquidity, Bloomberg News reported.
Defence-related stocks rose. North Navigation Control Technology surged by its 10 percent daily limit to 27.34 yuan in Shanghai, while AVIC Aircraft also jumped 10 percent to 25.86 yuan in Shenzhen.
Metals firms gained on the Shanghai market. Chengtun Mining gained 10 percent to 7.46 yuan, while aluminium producer Chalco rose 4.81 percent to 5.88 yuan.
Wanda Cinema, owned by Chinese tycoon Wang Jianlin, surged 44 percent — the maximum allowed for new listings — to 30.74 yuan in Shenzhen.
In Hong Kong, mainland-focused stocks led the gains, with Internet conglomerate Tencent rising 2.25 percent to HK$131.60 and telecoms giant China Mobile adding 1.18 percent to HK$103.30. Banking firm HSBC also rose 1.84 percent to HK$71.90. (AFP)