China Region Indexes Tumble; Profits at SOEs Surge 43%

Chandrasekhar Atreya
20 Dec, 2010
New York City

China key stock indexes drop on concerns of Korean tensions and rising debt crisis in Europe. Profits at state-owned enterprises surged 43% till November. Changsha Zoomlion Heavy Industry places priced its public offering in Hong Kong at the lower end of its price range.

[R]5:00 PM Hong Kong, China – China key stock indexes drop on concerns of Korean tensions and rising debt crisis in Europe. Profits at state-owned enterprises surged 43% till November. Changsha Zoomlion Heavy Industry places priced its public offering in Hong Kong at the lower end of its price range.[/R]

The key benchmark indexes in Shanghai and Hong Kong fell on concerns over Korean tension and the rising debt crisis in Europe.

The Shanghai Composite Index lost 1.41% or 40.82 to close at 2,852.92. The CSI 300 Index dropped 1.46% or 47 points to close at 3,178.66.

The Hang Seng Index in Hong Kong dropped by 0.33% or 75.77 to close at 22,639.08.

Profits at state-owned enterprises in China surged to 1.81 trillion yuan in the first 11 months of the year, up 43.1% from a year ago, according to the Ministry of Finance on Friday.

But profits in the month of November were lower by 2.6% when compared to October, according to a statement on the ministry’s Web site. In additions, the state owned companies paid a total of 2.23 trillion yuan as taxes in this period, a rise of 21.4% from a year ago.

The Yangtze River Delta region should explore ways to further integrate the service industry after the success of the World Expo to make it an engine to power its economy, officials and experts said on Friday at a forum in Shanghai.

“The World Expo has demonstrated how cities in the Yangtze River Delta region can join and cooperate in developing a service industry,” Shanghai Mayor Han Zheng said at the forum, which was organized by the development and reform commissions in Shanghai as well as in Zhejiang and Jiangsu provinces.

Cosco International Holdings Ltd, a shipping services provider, said it will sell its stake in Sino-Ocean Land Holdings Ltd to raise as much as HK$5.32 billion.

The sale covers a total of 949.9 million shares of Beijing-based real estate developer to be sold at HK$5.60 per share, about 10% above its closing price of HK$5.08 on Thursday, Cosco said in its filing to the Hong Kong Stock Exchange.

Dongfang Electric Corp said Friday it has received orders worth around 20.4 billion yuan from two Indian and one Chinese company.

In its regulatory filing to the Hong Kong Stock Exchange, Dongfang said it received three orders totaling around 20.4 billion yuan from two Indian companies and one Chinese firm in the field of thermal power, wind power and nuclear power export.

China’s Changsha Zoomlion Heavy Industry Science and Technology said Friday it priced its Hong Kong initial public offering at the low end of the indicated range according to a term sheet of the company.

Zoomlion priced its 869.6 million shares at HK$14.98 each, near the low end of the price range of HK$13.98 to HK$18.98 indicated.

Stock Movers

China Construction Bank declined 1.09% to 4.66 yuan. Kweichow Moutai Co, the country’s largest liquor maker by market value, fell 3.4% to 197.38 yuan.

Metal producers fell following lower metal prices on a stronger U.S. dollar. Jiangxi Copper was down 0.8% to 40.11 yuan and Aluminum Corp of China fell 1.8% to 10.19 yuan.

A gauge of healthcare stocks dropped 3% today after the Economic Observer reported that China may cut drug prices by 40% or more.

Kangmei Pharmaceutical dropped 4.6% to 21.15 yuan while North China Pharmaceutical Co dropped 2.59% to 16.46 yuan.