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Good bank earnings lift Hong Kong shares, China edges up
March 28, 2014 / 5:10 AM / 4 years ago

Good bank earnings lift Hong Kong shares, China edges up

* HSI +1.3 pct, HSCE +1.6 pct, CSI 300 +0.4

* ICBC helps with better-than-expected Q4 profit

By Natalie Thomas and Alice Woodhouse

SHANGHAI/HONG KONG, March 28 (Reuters) - Hong Kong shares produced a solid gain early Friday, lifted by the financial sector on strong bank earnings, while mainland index edged up, held down by falls in tech stocks.

By midday, the Hang Seng Index was up 1.3 percent at 22,113.66 points. The index was on track for its best week since September, as it was up 3.2 percent for this week.

The China Enterprises Index of the top Chinese listings in Hong Kong rose 1.6 percent. The index was heading for its best week since November, up 6.4 percent this week.

Industrial and Commercial Bank of China rose 2.8 percent in Hong Kong and 2.1 percent in Shanghai after the bank announced higher-than-expected net profit growth in the fourth quarter at 7.9 percent. [ID: nL4N0MO275]

“Short-term, the market movement will still be pretty much sideways, pending more news,” said Ben Kwong, Hong Kong-based chief operating officer of stockbroker KGI Asia.

The lack of direction in the market means investors will continue to take clues from individual company news and results announcements, he said.

The major mainland indexes had a quiet morning, with the Shanghai Composite Index closing up 0.3 percent at midday at 2052.57. The CSI300 index of leading Shanghai and Shenzhen A shares was up 0.4 percent.

Tech shares took a beating though, as investors locked in profit from the sector, pushing the Nasdaq-style ChiNext Composite Index of mostly high-tech start-ups down 2 percent by lunch, as investors transferred capital to more stable assets.

Hong Kong tech shares moved in the opposite direction, pulled up by online heavyweight Tencent Holdings, which clawed back some of the previous day’s 6.3 percent loss by registering a 2.4 percent gain.

Shares in telecoms equipment maker ZTE also performed well, rising 3 percent after the European Commission said it would no longer pursue an anti-dumping investigation into imports from China of equipment for mobile telecom networks.

The SSEC and CSI300 indexes also gained briefly on comments from Premier Li Keqiang, released on state media, that the government would use targeted measures to support the economy.

But prices soon slipped back, as investors found little that was new or concrete in the remarks.

“No matter whether you look at industry performance or economic data, things aren’t looking too optimistic. Unless we see some positive policies the market will not go up too much,” said Du Changchun, an analyst at Northeast Securities in Shanghai.

Shares in China’s biggest automaker SAIC Motor Corp climbed 9.6 percent, its biggest increase since, after the company posted forecast-beating 2013 earnings, helped by robust sales at its ventures with Volkswagen and General Motors. (Editing by Richard Borsuk)

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