Hong Kong shares advanced on Thursday, led by gains posted by insurers and on hopes of a rally in mainland stocks.

The Hang Seng Index climbed 0.82%, or 134.03 points, to finish the day's trade at 16,385.87. The Hang Seng China Enterprises Index (HSCEI) rose 0.94%, or 54.17 points, to 5,803.86.

China Pacific Insurance (HKG:2601) shot up nearly 6%. Ping An Insurance (HKG:2318) jumped more than 4% while rival AIA Group (HKG:1299) added over 2%, after a technical reading revealed the scrips have approached oversold territory.

"Valuation and sentiment are bombed out," Gary Tan and Derrick Irwin, portfolio managers at Allspring Global Investments said in a note on Wednesday. "This creates conditions for a substantial rally in Chinese shares, but sustainability is harder to determine."

In corporate news, HSC Resources Group (HKG:1850) surged almost 13% as trading in the stock resumed after the fire safety equipment provider said it raised some HK$18.1 million from a sale of 28.8 million shares at HK$0.56 apiece.