* HSI +0.7 pct, H-shares +0.7 pct, CSI300 -0.2 pct
* HK turnover highest this week, Shanghai stays weak
* HK property, HKEx lead reversal after Obama election win
* SAIC Motor Corp buck A-share weakness after Oct sales
By Clement Tan
HONG KONG, Nov 7 Hong Kong shares reversed
midday losses on Wednesday after U.S. President Barack Obama was
re-elected, producing their first gain in three days, with local
developers strong on hopes that greater fund inflows would
support property prices in the city.
The Hang Seng Index closed up 0.7 percent at 22,099.9
in its strongest turnover of the week, creeping back towards its
2012 closing high of 22,111.3 recorded last Friday. The China
Enterprises Index of the top Chinese listings in Hong
Kong also rose 0.7 percent.
The Shanghai Composite Index finished flat, while
the CSI300 Index of the top Shanghai and Shenzhen
listings slipped 0.2 percent, its third-straight drop. Shanghai
volume sank to its lowest in more than a week.
"There's been a fair amount of waiting in the market this
week. I think investors will come back into the Hong Kong market
in a bigger way after more clarity emerges from the Congress
meeting in Beijing next week," said Edward Huang, equity
strategist at Haitong Securities International.
China's 18th Communist Party congress will introduce a new
generation of leaders. It opens on Thursday and closes on Nov
On Wednesday, gains for Hong Kong developers picked up after
Obama won a second term, spurring expectations that a weaker
U.S. dollar will trigger more inflows into the Chinese territory
that could support property prices that have already more than
doubled from a 2008 trough.
Sun Hung Kai Properties rose 2.1 percent,
completely recovering gains from a 5.1 percent slump on Oct 29
after the Hong Kong government imposed fresh curbs on the home
sales aimed at cooling foreign demand.
Rival New World Development jumped 3.2 percent,
retracing about 75 percent of its 6.4 percent fall on Oct. 29.
It is still up 104 percent in 2012, compared to the 20 percent
gain for the Hang Seng Index.
In a report on Wednesday, released before the U.S. election
was called for Obama, Goldman Sachs analysts upgraded their view
on the Hong Kong property sector despite the government's latest
"With the market expecting the low interest rate environment
to continue, we may see more prospective homebuyers
front-loading their home purchases, which would likely create
more upward pressure on prices," they said in the report.
Bourse operator Hong Kong Exchanges, another
favourite inflows play, rose 1.9 percent to near a seven-month
high recorded on Monday after it posted better-than-expected
A-SHARES STAY WEAK AHEAD OF PARTY CONGRESS
On the mainland, markets remained weak ahead of the
once-in-a-decade political transition at the Congress meeting.
The Chinese banking and property sector were major drags
after the official Financial News newspaper, run by China's
central bank, reported that bad loan ratios at the country's top
banks may triple by the end of the year.
The report, which cited Orient Asset Management Corp, among
the four firms charged with cleaning up bad debts at China's
banks, implicated sectors ranging from the country's steel
sectors to local governments and property developers.
The Shanghai property sub-index was an
underperformer among sectors in the mainland, down 1 percent,
with Poly Real Estate down 1.7 percent.
Shenzhen-listed China Vanke shed 1.2 percent.
But Hong Kong-listed Evergrande bucked weakness in
the sector, jumping 9.3 percent to its highest close since
mid-July, in its best day in 5-1/2 months, after posting strong
October contract sales, which Deutsche Bank analysts said was a
record high for the company.
Strength in automakers also limited losses in mainland
Warren Buffet-backed BYD Co Ltd surged
10.6 percent in Hong Kong and 4.7 percent in Shenzhen, with
analysts citing rumors that the company could benefit from new
measures supporting clean energy vehicles in China.
SAIC Motor Corp rose 2.5 percent in Shanghai
after posting a 20.7 percent rise in October auto sales from a
year earlier, faster than its 4.6 percent growth in September.