* HK shares higher; finance issues lead gains
* China stocks up on Obama's visit; coal, metals plays lead
* Hong Kong food packaging company CPMC soars on debut
(Updates to midday)
By Donny Kwok and Claire Zhang
HONG KONG/SHANGHAI, Nov 16 (Reuters) - Hong Kong stocks were
higher by the midday break on Monday, with finance issues leading
gains following takeover talks on abundant liquidity, while
stocks in China climbed after U.S. President Barack Obama arrived
for talks.
New listings remained in focus. Food packaging company CPMC
Holdings Ltd (0906.HK), which raised US$139 million in an IPO,
rose to HK$7.05 on its trading debut, up nearly 31 percent from
its issue price of HK$5.39, before steadying at HK$6.50.
"It appeared to be a defensive choice in the longer run
because of its business nature and strong parent backing," said
Andrew To, a sales director at Taifook Securities.
He said demand for packaging products would not be affected
much by a market downturn, and that the stock appeared to be a
safer bet with the broader market at an expensive level on
abundant liquidity, making retail investors nervous.
Hong Kong's central bank, the Hong Kong Monetary Authority,
injected a total of HK$25.575 billion (US$3.3 billion) on Friday
to keep the Hong Kong dollar within its fixed trading band as
funds were attracted to upcoming IPOs. [ID:nHKG125144]
An increase in corporate takeover talk in the financial
sector fuelled demand for derivative-linked finance issues. HSBC
Holdings (0005.HK) climbed to a year high of HK$97.15 before
steadying at HK$97, still up 2.54 percent.
ICBC (1398.HK) rose to its new year high of HK$6.95 before
easing to HK$6.93, up 1.91 percent, and China Construction Bank
(0939.HK) gained 2.38 percent to HK$7.30
The benchmark Hang Seng Index .HSI rose 1.46 percent, or
330.08 points, to 22,883.71 at midday. Turnover decreased
slightly to HK$40.19 billion ($5.2 billion), from midday Friday's
HK$41.2 billion.
The China Enterprise Index .HSCE of top locally listed
mainland Chinese stocks gained 1.63 percent to 13,680.80.
Instant noodle and beverage maker Tingyi (0322.HK) rose 2.4
percent to an all-time high of HK$18.20 before paring gains to
HK$18.12. The Chinese noodle maker posted a 60 percent rise in
third-quarter earnings earlier this morning to US$147.4 million,
with a 9.6 percent rise in turnover from its instant noodle
business and a 26.2 percent jump in the beverages segment.
Despite a firm tone in the broader market, Cheung Kong
Infrastructure (1038.HK) (CKI) fell 2.34 percent to HK$29.25
before the infrastructure company and Hongkong Electric (0006.HK)
said during the midday break that they would spend 76 million
pounds ($127 million) to increase their stakes in British gas
distributor Northern Gas Networks. CKI also said was actively
studying bid for EDF's (EDF.PA) UK power grid. [ID:nHKF082473]
SHANGHAI RISES ON OBAMA VISIT
China's key stock index climbed 2.22 percent on Monday,
hitting a fresh three-month intraday high, with coal and metals
shares strong, while dollar-denominated Shanghai B shares jumped
to a 20-month high after U.S. President Barack Obama arrived in
China for talks expected to include the yuan.
The Shanghai Composite Index .SSEC ended the morning at
3,258,434 points after gaining 0.7 percent last week.
Obama paid his first visit to China as U.S. president for a
summit that will grapple with economic imbalance and currency
issues.
Gaining Shanghai A shares overwhelmed losers by 824 to 52,
while turnover jumped to 120 billion yuan ($18 billion) from
Friday's 81 billion yuan.
Shanghai's index of U.S. dollar-denominated B shares
surged 5.39 percent to 264.732 points, extending a 9.42 percent
gain on Friday as traders cited speculation about yuan
appreciation, as well as a possible merger with a planned
international board.
Analysts said attention to the Obama visit gave a boost to
shares related to topics such as yuan appreciation and new energy
sources.
"The yuan is not only under pressure to rise but also is
indeed likely to rise. The index looks likely to make progress
above the 3,200 point level," said Wen Lijun, an analyst at
Nanjing Securities.
Coal shares led the gains as heavy snow created difficulties
for transporting coal, which could boost coal prices. China
Shenhua Energy (601088.SS) gained 4.99 percent to 37.27 yuan
while Yanzhou Coal (600188.SS) jumped 6.47 percent to 21.38 yuan.
Unseasonably early and heavy snow in northern China had
caused at least 38 deaths, the official Xinhua news agency said.
[ID:nPEK129447]
Renewable energy shares were active, with China's Tongwei
(600438.SS), a solar energy company, racing up by its 10 percent
daily limit to 10.35 yuan.
Metals shares were firmer, with Jiangxi Copper (600362.SS) up
4.62 percent at 42.15 yuan as copper futures prices rose.
(Editing by Chris Lewis)
