Hong Kong's dual-listed stocks traded at the narrowest discount to their Chinese mainland counterparts since October as cheaper valuations in the city lured investors.

The Hang Seng China AH Premium Index fell 0.7 percent, signaling Hong Kong-traded equities were 22 percent cheaper than those in Shanghai or Shenzhen.

A gauge of mainland shares in Hong Kong rose, while the Shanghai Composite Index dropped for a third day. Huaneng Power International Inc advanced the most in almost two months in Hong Kong, while its A shares retreated. The MSCI Hong Kong Index was poised to enter a bull market.