Hong Kong - An index of major China companies listed in Hong Kong on Wednesday surged to its highest close this year, as investors piled into financial and energy stocks seen as undervalued.

The China Enterprises Index climbed 2 percent to close at its highest since December 27, while the benchmark Hang Seng Index was up 0.8 percent at 23,971.87 points, its highest since December 2.

Daily bourse volume was the heaviest since April 11.

Chinese property stocks were top percentage gainers on the Hang Seng for a second day, with China Resources Land jumping 7.5 percent and China Overseas Land & Investment up 4.4 percent.

The 21st Century Business Herald reported late on Tuesday around 10 more Chinese cities are expected to relax home-purchase restrictions under the pressure of high inventories.

Oil and insurer giants led HSCE gains.

PetroChina rose 3.1 percent to its highest since March 2013, while China Life Insurance gained 2.9 percent. - Reuters