Buying in telco drives HK shares 2% higher | Shanghai Daily

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August 7, 2009

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Buying in telco drives HK shares 2% higher

HONG Kong shares jumped 2 percent yesterday to end at an 11-month closing high as early losses were erased by strong buying in China Mobile on speculation the company was on track to list in Shanghai.

HSBC rose 3.3 percent in Hong Kong, extending gains to nearly 10 percent since its first-half earnings on Monday. Europe's biggest bank has hired China International Capital Corp and CITIC Securities Co to help arrange an initial public offering in Shanghai, Reuters reported on Tuesday.

China Mobile soared 7.5 percent to end at an 11-month closing high of HK$87.10 (US$11.24) as investors snapped up the laggard stock, partly on market talk that the world's largest wireless carrier may list on the Chinese mainland's A-share market by the end of this year.

"The A-share market will go crazy for this stock," said Francis Lun, general manager with Fulbright Securities.

The index heavyweight has risen 12 percent so far this year, underperforming the 45 percent rally on the main index. Other Chinese telecom stocks also surged. China Unicom piled on 7.9 percent and China Telecom vaulted 6.4 percent.

The benchmark Hang Seng Index finished up 2 percent, or 404.47 points, at 20,899.24, its highest close since September 2008.

The China Enterprises Index, which represents top locally listed mainland stocks, underperformed to rise 0.7 percent to 12,052.60 as top lender ICBC gave up 1.3 percent.

"Lower loan growth at banks and a tightening of lending to the property sector are the biggest concerns," said Steven Leung, sales director with UOB Kay Hian.

The world's No. 4 personal computer brand, Lenovo, finished 5.2 percent higher after the company reported a smaller-than-expected first-quarter loss. The stock dropped as much as 6.8 percent during morning trading as investors locked in gains on the more than 50 percent rally in the stock in the three weeks to Tuesday.




 

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