Main­land H shares head to­ward five-month high

China Daily (Canada) - - BUSINESS - By BLOOMBERG

Hang Seng China En­ter­prises In­dex poised for high­est close since Sept

A mea­sure of main­land shares traded in Hong Kong headed to­wards a five-month high, led by prop­erty de­vel­op­ers and car­mak­ers amid op­ti­mism their earn­ings out­look will im­prove.

The Hang Seng China En­ter­prises In­dex ad­vanced 1.1 per­cent on Wed­nes­day, poised for the high­est close since early Septem­ber. A gauge track­ing Chi­nese main­land real es­tate com­pa­nies jumped by 5.3 per­cent to the high­est in more than four months.

Hong Kong’s bench­mark Hang Seng In­dex added 0.7 per­cent to 23,485.13 on Wed­nes­day, with Hong Kong Ex­changes & Clear­ing Ltd surg­ing in af­ter­noon trade. The Shang­hai Com­pos­ite In­dex ended the day

0.4 per­cent in the black.

China’s prop­erty de­vel­op­ers are in far bet­ter shape than their rock-bot­tom stock val­u­a­tions in­di­cate, ac­cord­ing to an­a­lysts from firms in­clud­ing Gold­man Sachs Group Inc and Cit­i­group Inc China Ever­grande Group, China Vanke Co and Coun­try Gar­den saw con­tracted sales jump by 90 per­cent, 274 per­cent and 75 per­cent in Jan­uary, re­spec­tively, ac­cord­ing to pri­vate data provider China Real Es­tate In­for­ma­tion Corp.

Van Liu, an an­a­lyst at Guo­tai Ju­nan Hong Kong Ltd, said: “Prop­erty de­vel­op­ers are ex­pected to out­per­form in the near term. Jan­uary sales of listed de­vel­op­ers were bet­ter than ex­pected.”

The Great Wall Mo­tor Co ral­lied by 5.6 per­cent and BYD Co jumped by 4.9 per­cent, leading gains on the Hang Seng China En­ter­prises In­dex. Geely Au­to­mo­bile Hold­ings Ltd ad­vanced by 2.9 per­cent. Con­sen­sus earn­ings es­ti­mates have been raised for both last year and this year for most Chi­nese car­mak­ers, ac­cord­ing to a note by Bloomberg In­tel­li­gence.

Main­land in­sur­ers ex­tended their rally in Hong Kong, with China Taip­ing In­sur­ance Hold­ings Co gain­ing 2.9 per­cent, as an­a­lysts bet that lo­cal pen­sion funds­may soon en­ter the stock mar­ket, and as higher bor­row­ing costs would boost in­vest­ment yields.

China will soon hold an an­nual meet­ing on the su­per­vi­sion of the se­cu­ri­ties mar­kets, the China Se­cu­ri­ties Jour­nal re­ported. Reg­u­la­tors may fine-tune poli­cies on eq­uity fi­nanc­ing, the re­port cited uniden­ti­fied in­dus­try par­tic­i­pants as say­ing.

REUTERS

A bill­board dis­plays the morn­ing trad­ing on the first day of trade af­ter the Lu­nar New Year at the Hong Kong Ex­changes.

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