Higher metal prices, manufacturing boost HSI
Updated: 2009-08-04 07:39
(HK Edition)
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HONG KONG: Stocks rose as reports showed manufacturing on the mainland continued to expand and as commodities producers climbed on higher metals prices.
Angang Steel Co, the second-largest steelmaker on the mainland, jumped 7.1 percent on the purchasing managers' index reports. Aluminum Corp of China Ltd, the nation's biggest producer of the metal, advanced 7.2 percent after saying it will raise prices. Clothing retailer Giordano International Holdings Ltd rose 9.9 percent ahead of monthly retail sales data for Hong Kong.
"The PMI is another confirmation that China's economy is staging a strong recovery," said Michiya Tomita, who helps manage $61 billion at Mitsubishi UFJ Asset Management Co in Hong Kong. The Hang Seng Index added 1.1 percent to 20,807.26 at the close of trading, the highest level since September 2. The Hang Seng China Enterprises Index, which tracks so-called H shares of mainland companies, gained 2 percent to 12,368.20.
The benchmark Hang Seng Index has soared 83 percent from a more than four-month low on March 9 amid speculation stimulus efforts worldwide, including 4 trillion yuan ($586 billion) of spending on the mainland, will revive global growth.
Angang Steel gained 7.1 percent to HK$18.82. Nine Dragons Paper (Holdings) Ltd, the country's biggest maker of containerboard paper for packaging, advanced 5.5 percent to HK$8.43 after Citigroup Inc lifted the shares to "buy" from "sell."
Denway Motors Ltd, a partner of Japan's Honda Motor Co, rose 8.1 percent to HK$4.16.
The CLSA China Purchasing Managers' Index rose to a seasonally adjusted 52.8 in July from 51.8 in June, CLSA said yesterday. That was the fourth consecutive month above the 50 level that signals expansion.
Meanwhile, the official Purchasing Managers' Index climbed to a seasonally adjusted 53.3 in July from 53.2 in June, the Federation of Logistics and Purchasing said in a statement over the weekend.
"This is a positive factor that continues to sustain investor confidence," said Ben Kwong, chief operating officer at brokerage KGI Asia Ltd. in Hong Kong. "People are expecting that there will be more improvements in all the related sectors like industrial stocks and raw-material stocks."
Aluminum Corp jumped 7.2 percent to HK$9.67. The company said yesterday it boosted the price of alumina, a raw material, by 4.3 percent from July 31.
China National Resources Development Holdings Ltd gained 6.3 percent to HK$1.19. Jiangxi Copper Co, the country's biggest producer of the metal, rallied 5.9 percent to HK$18.94. Zijin Mining Group Co, the largest gold miner on the mainland, surged 6.9 percent to HK$7.73.
Copper for September delivery climbed 2.6 percent in after-hours trading, adding to the 2.3 percent it rose in New York on July 31. Gold gained 0.4 percent to $955.88 an ounce Monday.
Giordano surged 9.9 percent to HK$2.66. Haier Electronics Group Co, the world's biggest refrigerator maker, rallied 13 percent to HK$1.72.
Five stocks advanced for every two that fell on the 42-member Hang Seng Index. August futures added 1.9 percent to 20,750.
Bloomberg News
(HK Edition 08/04/2009 page4)