Developers in China in Focus; China Vanke Fall

Mayank Mehta and Darlington
27 Apr, 2010
New York City

Market indexes declined in Shanghai and Hong Kong fell on the worries that China will tighten lending and oversight of property developers. Banks declined in Shanghai. China Vanke declined after the developer said earnings dropped 53%.

[R]8:30 PM Hong Kong, China – Market indexes declined in Shanghai and Hong Kong fell on the worries that China will tighten lending and oversight of property developers. Banks declined in Shanghai. China Vanke declined after the developer said earnings dropped 53%.[/R]

Stocks in Shanghai and Hong Kong fell on the worries that ongoing related to Greek default. Property developers declined as China stepped up more oversight of developers.

Ba Shusong, deputy director general of the Development Research Center of State Council said to Shanghai Securities News that China may increase capital requirements and other conditions to curb property market speculation.

Hang Seng index in Hong Kong decreased 325.27 or 1.51% to 21,261.79 and CSI 300 index in China lower 63.59or 2.00% to 3,108.41.

Banks and property developers declined in Hong Kong trading. Bank of Communications Ltd declined 1.7% and China Construction Bank decreased 1.6%.

Sun Hung Kai & Co. surged 14% after the company said CVC Capital Partners agreed to invest HK$2.2 billion or $275 million in the brokerage firm.

Shanghai Movers

Air China Limited decreased 6.9% to 12.86 yuan after the carrier is increasing capital expenditure by more than 50% to 15 billion yuan this year to boost capacity by to 12%.

Bank of China Limited closed unchanged at 4.04 yuan the commercial bank said quarter net interest income rose 21% to 44.5 billion yuan from 36.8 billion yuan a year ago. Net profit in the quarter rose 41% to 26.2 billion or 0.10 yuan per diluted share compared to net profit of 18.6 billion yuan or 0.07 yuan per share a year ago.

China Vanke Co., Ltd fell 2.4% to 7.61 yuan after the property developer said first quarter profit dropped 53% to 1.13 billion yuan. The property developers declined after China tightened mortgage rules for second and third home purchases and stepped up monitoring of developers.

China Southern Airlines Company Limited the carrier fell 6.2% to 8.28 yuan.

China Eastern Airlines Corporation Limited dropped 4.9% to 9.20 yuan.

PetroChina Company Limited slipped 2.7% to 11.84 yuan after the oil and copper producers and Sinopec Corp even as the same price surge squeezes their refining business due to Beijing''s rigid fuel price regime.

HK Movers

China Railway Group Limited fell 0.7% to HK$5.58 after the company said first quarter net profit increased 68%.

China Unicom (Hong Kong) Ltd added 3.1% to HK$9.53 on the wireless carrier is likely to lower iPhone price by 1,000 yuan according to a report by China Business News.

Stella International Holdings Limited the footwear maker and retailer fell 0.9% to HK$15.50.

Uni-President China Holdings Ltd fell 6.1% to HK$4.58 after the mainland Chinese unit of Taiwan’s food supplier was downgraded to “underweight” from “neutral” by JPMorgan Chase & Co.

Weichai Power Co., Ltd slipped 3.2% to HK$66.85 after the maker of diesel engines said net profit surged 76% in 2009.