* HK shares close at 16-month high; finance issues lead gains
* China stocks up on Obama's visit; energy, airlines active
* Hong Kong food packaging company CPMC soars on debut
(Updates to close)
HONG KONG/SHANGHAI, Nov 16 (Reuters) - Hong Kong and China
stocks were higher on Monday as abundant liquidity and
expectations of yuan appreciation on the visit of U.S. President
Barack Obama to the mainland, fuelled buying for yuan-related
assets.
Hong Kong shares rose 1.73 percent for a second straight
session of gains with banks leading the rise. The benchmark Hang
Seng Index closed up 390.35 points at 22,943.98, its highest
close since July 24, 2008.
HSBC Holdings (0005.HK) climbed to as high as to HK$97.55, a
13-month high, before closing at HK$97.10, up 2.64 percent. HSBC
said it would sell its European headquarters in London for 772.5
million pounds ($1.3 billion), giving a profit of about 350
million pounds on the sale and leaseback deal. [ID:nSE0329394]
ICBC (1398.HK), China's largest lender, rose to a 25-month
high of HK$6.98 before ending at HK$6.96, up 2.35 percent. China
Construction Bank (0939.HK) gained 3.65 percent to HK$7.39.
"Yuan appreciation fuelled demand for yuan assets while a
record high for gold fuelled buying of resources issues," said
Francis Lun, general manager from Fulbright Securities.
"There is no doubt that it (the benchmark index) will breach
the 23,000 level," Lun said, adding that the market could gain
further if positive sentiment remained.
Gold rose to record high on Monday of $1,132.40 per ounce as
the U.S. dollar weakened, sending gold miner Zijin Mining
(2899.HK) up 6.01 percent and copper producer Jiangxi Copper
(0358.HK) up 11.75 percent.
Food packaging company CPMC (0906.HK), which raised US$139
million in an IPO, rose to HK$7.05 during its trading debut, up
nearly 31 percent from its issue price of HK$5.39. It ended the
session at HK$6.11.
The China Enterprises Index of top locally listed mainland
Chinese stocks .HSCE rose 2.15 percent to 13,751.65.
Turnover rose to HK$76.36 billion (US$9.85 billion), from
Friday's HK$70 billion.
Hong Kong's central bank, the Hong Kong Monetary Authority,
on Monday injected HK$3.1 billion (US$400 million) into the money
market to keep the local currency within its fixed trading band.
[ID:nHKG175780]
Instant noodle and beverage maker Tingyi (0322.HK) rose to an
all-time high of HK$18.30 before paring gains to HK$18.26, up 2.7
percent. It posted a 60 percent rise in third-quarter earnings
this morning to US$147.4 million.
Cheung Kong Infrastructure (1038.HK) (CKI) fell 2.84 percent.
It said it was interested in bidding for Britain's biggest
electricity distribution network, which was being sold by French
utility EDF (EDF.PA). [ID:nHKG165765]
SHANGHAI RISES ON OBAMA VISIT
China's key stock index jumped 2.74 percent on Monday to a
three-month closing high in heavy turnover, as U.S. President
Barack Obama's visit boosted expectations of yuan appreciation
that have attracted overseas capital into China's markets.
Renewable energy and airline shares were also active after
Obama arrived in China for talks expected to include the yuan's
value and climate change. [ID:nPEK158853]
The Shanghai Composite Index .SSEC ended at 3,275.048 ,
points, posting its biggest daily percentage rise since Oct. 9
after gaining 0.7 percent last week.
Turnover climbed to a three-month high of 226 billion yuan
($33.11 billion) from Friday's 144 billion yuan, while gaining
Shanghai A shares overwhelmed losers by 804 to 69 while
"Expectations for hot money to keep flowing into China, amid
pressure for yuan appreciation, encouraged buying and most market
players are confident the index will surpass the year's high (of
3,478 hit in August)," said Zhang Qi, senior analyst at Haitong
Securities in Shanghai.
Obama, who arrived in Shanghai late on Sunday night and flew
on to Beijing on Monday afternoon in his first trip to China as
president, has said he will raise the issues of the yuan's
exchange rate, which critics charge undervalues the currency and
gives Chinese exporters an edge in global trade, during his talks
in Beijing.
But Shanghai's index of U.S. dollar-denominated B shares
ended down 0.38 percent at 250.241 points, hit by
profit-taking after surging more than 9 percent on Friday and
extending those gains early on Monday. Traders cited speculation
about yuan appreciation, as well as a possible merger with a
planned international board.
J.P. Morgan chairman of China equities Jing Ulrich said on
Monday that the first red-chip and foreign companies could list
on the Shanghai stock exchange next year.
Coal shares led the day's gains as heavy snow disrupted coal
transport and could boost prices. China Shenhua Energy
(601088.SS) gained 5.89 percent to 37.59 yuan, while Yanzhou Coal
(600188.SS) jumped 6.57 percent to 21.40 yuan.
Unseasonably early and heavy snow in northern China had
caused at least 38 deaths, the official Xinhua news agency
reported. [ID:nPEK129447]
Renewable energy shares were active, with China's Tongwei
(600438.SS), a solar energy company, up by its 10 percent daily
limit at 10.35 yuan.
Airline shares surged, with Air China (601111.SS) up 6.79
percent at 8.96 yuan, after most airlines doubled their fuel
surcharges over the weekend on rising oil prices. The sector,
with a high proportion of its costs denominated in foreign
currencies, would also stand to benefit from yuan appreciation.
Metal shares were firmer, with Jiangxi Copper (600362.SS) up
6.58 percent at 42.94 yuan as copper futures prices rose.
(US$1=HK$7.75)
(Editing by Chris Lewis)
