China Region Mixed Trading

Mayank Mehta, Chandrasekhar Atreya and Sanjay Barot
07 Jul, 2010
New York City

Stocks in China gained but in Hong Kong fell. China is proposing a price-based resource tax in western provinces. Agbank completes subscription period for its public offering. Everbright Securities to establish 15 new sales offices.

[R]5:00 PM Hong Kong, China – Stocks in China gained but in Hong Kong fell. China is proposing a price-based resource tax in western provinces. Agbank completes subscription period for its public offering. Everbright Securities to establish 15 new sales offices. ICBC may raise $6.6 billion in rights offers. SAIC June auto sales growth slows.[/R]

Trading in China remained focused on the largest initial public offering. Agbank completed the placement of its offering after it priced shares at the low of end of its filing range. Stocks in Hong Kong fell below the 20,000 mark after a Chinese government official said the mainland nation’s economy is facing increased uncertainties.

The report that showed services industries in U.S. expanded more slowly than estimated also added to investor concerns.

The Hang Seng Index retreated 1.13% or 227.05 points to close at 19,857.07 for its fifth decline in six days. The CSI 300 Index gained 0.69% or 17.58 to close at 2,580.48.

China’s economy is facing increasing uncertainties and the situation is becoming more complex, Ma Jiantang, Head of National Bureau of Statistics, according to the bureau’s newspaper today.

China is planning to impose a new price-based resource tax on coal, oil and gas extraction in its western provinces, so that funds can be raised to develop this restive region of the nation.

The country will change the tax to a price-based rather than a volume-based levy, the government in China said in a statement on its Web site, citing comments by Premier Wen Jiabao at a meeting with officials yesterday.

President Hu Jintao has pledged to double investment in the western province of Xinjiang where social stability has been a priority since Urumqi, the capital, saw the country’s deadliest rioting in decades last July that left at least 197 people dead.

China is planning to develop 13 solar power projects in the western region as part of the government’s aim to cut emissions and boost energy investment in this area.

“The government is tendering for bids to develop these projects in six provinces, which will have a combined capacity of 280 megawatts,” the National Development and Reform Commission, the country’s top planner, said in a statement on its Web site yesterday.

After investor’s subscriptions to the yuan-dominated shares of the nation’s largest lender by customers ended yesterday, China’s benchmark money-market rate declined the most in a week as demand for capital waned in the nation.

Agbank completed its IPO subscription period yesterday and investors who failed to subscribe will receive their refunds back on July 8 and July 9, according to the bank’s statement released on July 1.

China, the world’s second-largest corn consumer, may import 10 times more corn than the current demand, by the year 2015, after economic growth raises demand for meat and feed, Marubeni Research Institute said.

“Imports may expand to 10 million tons in 2015, from the 1 million ton forecast for the current year, as the Asian nation turns to cheap corn supplies from overseas for feed. China is not considering maintaining its self sufficiency for corn as the grain is no longer an important food crop for the people of China,” said Akio Shibata, Chief Representative for the research unit of the Tokyo-based Marubeni Corp, Japan’s biggest grain trader.

Shanghai Movers

Changsha Zoomlion Heavy Industry Science And Technology Development Co., Ltd surged 9.9% to 18.84 yuan after the company said its first-half net income may double to 2.17 billion yuan or $320 million from a year earlier, according to a stock exchange filing.

Chongqing Changan Automobile Company Limited rose 0.5% to 8.93 yuan after the company’s sales in June rose 17% from a year earlier to 148,001 units, according to a statement filed to the Shenzhen Stock Exchange.

Everbright Securities Co., Ltd rose 1.1% to 15.31 yuan after its board approved the company''s plan to open 15 new sales offices in regions designated by the China Securities Regulatory Commission, reports Yicai.com, citing a company filing on July 5.

Industrial and Commercial Bank of China Limited fell 0.4% to 4.12 yuan after the lender said it may raise up to 45 billion yuan or $6.6 billion through rights offers, a banking source confirmed on Wednesday.

SAIC Motor Corporation Limited rose 1.1% to 12.58 yuan after the company sold 30% more vehicles in June compared with a year earlier, the second slowest monthly gain so far this year as demand in the world''s largest auto market moderates after rapid expansion in 2009, according to a Reuters report.

Shanghai International Port (Group) Co., Ltd fell 0.2% to 3.79 yuan after the company forecasts that first half 2010 net profit will increase by about 50% year-on-year, according to a company filing.

HK Movers

Sinotrans Shipping Limited fell 2.6% to HK$2.94.