* HSI +1.0 pct, H-shares +1.5 pct; China shut for holiday
* Macau casinos lifted by strong Chinese holiday visitors
* Sands China, Galaxy Entertainment at record highs
* China dairy sector jumps ahead of Huishan's FTSE inclusion
By Clement Tan
HONG KONG, Oct 3 Hong Kong shares rebounded
further from three-week lows early on Thursday, lifted by the
Macau casino and Chinese consumer sectors on hopes that the
ongoing Golden Week holiday in the mainland will generate
China's official purchasing managers index (PMI) for the
non-manufacturing sector came in at 55.4, its highest since
March, further buoying market sentiment as benchmark indexes
recover steep losses earlier this week.
At midday, the Hang Seng Index, which had closed on
Monday at its lowest since Sept. 9, was up 1 percent at 23,207
points. The China Enterprises Index of the top Chinese
listings in Hong Kong climbed 1.5 percent.
Hong Kong markets were shut on Tuesday for China's National
Day holiday, while the mainland will reopen Oct. 8.
Gains on the day came in lacklustre turnover, pointing at
underlying caution as the U.S. government shutdown dragged on,
but helped both indexes recover steep losses on Monday as the
third quarter came to a close.
"Monday's dip at quarter-end was irrational to begin with,
so we're seeing a recovery of that move down. Of course, there's
the good services PMI, but gains are coming in weak turnover,"
said Hong Hao, chief strategist at Bank of Communications
Hong added that the Hang Seng benchmark could return to 2013
highs in February at about 24,000 by year's end, but is unlikely
to break out of chart resistance at about 25,000 without a
dramatic turnaround in China's economy.
That level was recorded in November 2010 and remains the
highest the index has reached for more than seven years.
On Thursday, Macau casinos were lifted by a strong start to
the Oct. 1-7 National Day holiday. Sands China jumped
3.2 percent and Galaxy Entertainment 3 percent, to hit
respective record highs.
Hong Kong August retail sales data is due later in the day,
while Macau gaming revenue data for September is also expected
by this week.
Deutsche Bank is already expecting a "record-breaking"
October after Macau visitors from the mainland rose 16 percent
on Oct. 1 from a year earlier, even as total visitor arrival
numbers fell 6 percent.
"This year, strong Chinese demand has pushed up hotel rates.
This has in turn discouraged Hong Kong people from visiting
Macau. This displacement ... is positive for rising bet limits
as spend per trip is higher for Chinese visitors," Deutsche
analysts said in a note on Thursday.
Luxury retailers also got a lift, with Italian brand Prada
up 2.4 percent and luxury watch retailer Hengdeli
climbing 2.1 percent. Gold miners and jewellery
retailers also got a lift from rebounding gold prices.
There was strong interest in the Chinese dairy sector ahead
of the inclusion of China Huishan Dairy Holdings on
FTSE's All-World, All-Emerging and FTSE China (Hong Kong listed)
indexes effective Oct. 7.
Huishan Dairy, which just made its listing debut last
Friday, surged 7.9 percent, lifting sector rivals China Modern
Dairy and China Mengniu Dairy. Milk power
producer Biostime jumped 5.5 percent.
Local media reported that Chinese dairy companies are hiking
prices during the Golden Week holiday.