Top Biz News
Equities surge on hopes of better industrial earnings
(China Daily/Agencies)
Updated: 2009-12-29 08:08
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The mainland's stocks rose to a two-week high after profits at industrial companies surpassed pre-crisis levels in the past three months and the government raised price caps for rural purchases of home appliances.
China Petroleum & Chemical Corp, Asia's biggest oil refiner, also known as Sinopec, gained 1.7 percent. China Shenhua Energy Co, the nation's largest coal producer, added 1.9 percent.
GD Midea Holding Co, China's second-biggest publicly traded appliance maker, climbed to a 19-month high, and Hisense Electric Co, a manufacturer of flat-panel televisions, surged to a record 5.8 percent.
"The economic recovery is still well under way and corporate earnings are improving," said Larry Wan, the Shanghai-based deputy chief investment officer at KBC-Goldstate Fund Management Co, which oversees about $583 million. "There's no reason to be bearish on equities."
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The index has rallied 75 percent this year as government spending and a credit boom helped the nation's economy recover from its steepest slump in more than a decade.
Net income for Chinese industrial companies grew 7.8 percent in the January to November period to 2.59 trillion yuan ($379 billion) from a year earlier, the statistics bureau said yesterday. Profits dropped 10.6 percent in the first eight months of the year. Premier Wen Jiabao said on Sunday that the government was wary of derailing the recovery by withdrawing stimulus measures too early.
Hang Seng drops
Hong Kong's Hang Seng Index fell, erasing gains, after the city's government sold two sites at prices that missed analysts' estimates.
Sino Land Co climbed 0.6 percent, paring gains of as much as 2.2 percent ahead of the sale of two plots near three sites already owned by the developer. K Wah International Holdings Ltd slid 1.7 percent. The two companies were winning bidders in yesterday's auction. China Resources Power Holdings Co, a mainland electricity supplier, advanced 0.8 percent after the Shanghai Securities News said China's 2010 energy demand may increase 3.6 percent.
"Apart from Sino Land, which owns sites nearby and would benefit from paying a higher premium, other developers weren't keen on pushing up the price," said Conita Hung, head of equity markets at Delta Asia Securities Ltd in Hong Kong. "Given the site is being sold at below market expectations, investors will take the chance to take their gains in developers' stocks."
The Hang Seng Index retreated 0.2 percent to close at 21480.22, reversing gains of as much as 1 percent before the auction. That halted a three-day, 2.7 percent advance of the measure, which was the only major equity benchmark in Asia to retreat yesterday.
The Hang Seng China Enterprises Index, which tracks so-called H shares of Chinese companies listed in Hong Kong, dropped 4.22 points, or less than 0.1 percent, to 12669.52.
Sino Land rose 0.6 percent to HK$14.74, after climbing as much as 2.2 percent.
