HK, China shares end higher, Geely up on Volvo talks
Sunday, 27 December 2009
HONG KONG/SHANGHAI, Dec 26 (Reuters): China's key index ended up 2.59 per cent, partly led by China State Construction Engineering Corp, on news that its parent was buying more shares in the listed unit, as institutional investors returned to the market after winding up year-end settlements.
The Shanghai Composite Index finished up 79.633 points at 3,153.410, scoring its biggest daily percentage gain this month and regaining the key 125-day moving average, now at 3,098.
The index was also boosted as prospects for China's economic recovery offset the negative impact of heavy new share supplies.
Cash calls for year-end settlement by institutions, including mutual funds and brokerages, had contributed to a one-month market fall of nearly 10 per cent until Tuesday, although the fall was also driven by an official campaign to clamp down on excessive asset prices, including adding share supplies.
"Institutional investors typically push share prices up in the final few trading days of the year for better year-end book value, although they also typically only trade lightly at this time of year," said a senior trader at a major Chinese brokerage.
Traders said they expected the market to stage a slow but steady rally for the rest of this year, adding, however, that the key index should encounter stiff resistance at the psychologically important 3,300-point level.
China State Construction, the country's top building company, was one of Thursday's most actively traded stocks, ending up 1.77 per cent at 4.61 yuan after its parent bought 5 million additional shares in the listed unit and promised to buy more over the next 12 months to support its share price.
Some other newly listed stocks this year, including China Merchants Securities, and Metallurgical Corp of China, have fallen below their initial public offer prices during the market downtrend of the past few weeks.
Hong Kong shares rose for a third straight day Thursday aided by property plays on upbeat expectations for a government land auction next week.
Geely Auto rose to a weekly high of HK$4.30, before closing at HK$4.26, up 7.04 per cent. Ford Motor said it was nearing an agreement to sell its Volvo unit to Geely, parent of Geely Auto.
The benchmark Hang Seng Index ended up 0.88 per cent or 188.26 points at 21,517 in holiday-shortened trading session, its highest close in more than a week. The index ended the four-day week up 1.61 per cent.
The China Enterprises Index of top locally listed mainland Chinese stocks rose 1.16 per cent to 12,673.74.
Market turnover increased to HK$27.55 billion ($3.55 billion), from midday Wednesday's HK$21.86 billion.
The Hong Kong market closed at midday for the Christmas holiday and will be reopen on Dec 28.
"The market was quiet and steady this morning," said Alfred Chan, chief dealer at Cheer Pearl Investment. "Players took a breather after recent volatility while property stocks stayed firm ahead of a land auction."
Local property issues extended their advance on hopes for a strong response to an upcoming auction of two plots of land for residential purposes in Hong Kong on Monday. Market watchers expected the auction to draw keen competition among developers.
New World Development rose 1.15 per cent, Wharf Holdings climbed 1.41 per cent, Sun Hung Kai Properties gained 0.7 per cent, and Sino Lands up 0.83 per cent.
The Shanghai Composite Index finished up 79.633 points at 3,153.410, scoring its biggest daily percentage gain this month and regaining the key 125-day moving average, now at 3,098.
The index was also boosted as prospects for China's economic recovery offset the negative impact of heavy new share supplies.
Cash calls for year-end settlement by institutions, including mutual funds and brokerages, had contributed to a one-month market fall of nearly 10 per cent until Tuesday, although the fall was also driven by an official campaign to clamp down on excessive asset prices, including adding share supplies.
"Institutional investors typically push share prices up in the final few trading days of the year for better year-end book value, although they also typically only trade lightly at this time of year," said a senior trader at a major Chinese brokerage.
Traders said they expected the market to stage a slow but steady rally for the rest of this year, adding, however, that the key index should encounter stiff resistance at the psychologically important 3,300-point level.
China State Construction, the country's top building company, was one of Thursday's most actively traded stocks, ending up 1.77 per cent at 4.61 yuan after its parent bought 5 million additional shares in the listed unit and promised to buy more over the next 12 months to support its share price.
Some other newly listed stocks this year, including China Merchants Securities, and Metallurgical Corp of China, have fallen below their initial public offer prices during the market downtrend of the past few weeks.
Hong Kong shares rose for a third straight day Thursday aided by property plays on upbeat expectations for a government land auction next week.
Geely Auto rose to a weekly high of HK$4.30, before closing at HK$4.26, up 7.04 per cent. Ford Motor said it was nearing an agreement to sell its Volvo unit to Geely, parent of Geely Auto.
The benchmark Hang Seng Index ended up 0.88 per cent or 188.26 points at 21,517 in holiday-shortened trading session, its highest close in more than a week. The index ended the four-day week up 1.61 per cent.
The China Enterprises Index of top locally listed mainland Chinese stocks rose 1.16 per cent to 12,673.74.
Market turnover increased to HK$27.55 billion ($3.55 billion), from midday Wednesday's HK$21.86 billion.
The Hong Kong market closed at midday for the Christmas holiday and will be reopen on Dec 28.
"The market was quiet and steady this morning," said Alfred Chan, chief dealer at Cheer Pearl Investment. "Players took a breather after recent volatility while property stocks stayed firm ahead of a land auction."
Local property issues extended their advance on hopes for a strong response to an upcoming auction of two plots of land for residential purposes in Hong Kong on Monday. Market watchers expected the auction to draw keen competition among developers.
New World Development rose 1.15 per cent, Wharf Holdings climbed 1.41 per cent, Sun Hung Kai Properties gained 0.7 per cent, and Sino Lands up 0.83 per cent.