Chinalco Stake in Rio Tinto, HK Stocks Rebound

123jump.com Staff
01 Feb, 2008
New York City

Stocks in Hong Kong recovered ahead of the holiday season. Snowfall in China has disrupted transportation network stranding hundreds of thousands of people. Several mining facilities and commodities facilities are likely close down. Jiangxa Copper will shutdown 43% or 300,000 tons of smelting capacity as a result of power outages until mid-February.

[R]6:00AM New York, 6:00PM Hong Kong – Stocks in Hong Kong recovered ahead of the holiday season. Snowfall in China has disrupted transportation network stranding hundreds of thousands of people. Several mining facilities and commodities facilities are likely close down.[/R]

Stocks in Hong Kong closed up after investors returned to buy stocks and positioned themselves ahead of the Chinese New Year holiday that begins in Hong Kong on February 7.

In Hong Kong trading Hang Seng Index recovered 2.9% or 667.84 at 24,123.58, a 4% decline for the week, and the China Enterprises index climbed 6.4% or 799.67 to 13,284.74, falling 5.2 % for the week.

Daily turnover on main-board was HK$119.4 billion compared to HK$110.7 billion yesterday.

Xinhua News Agency online edition reported today that heavy snowfalls in the Northern China have cost the Chinese economy up to Rmb 53.9 billion.

The Standard news online reported today that Standard Chartered will purchase commercial paper issued by Whistlejacket Capital up to the outstanding amount of US$7.15 billion.

The lender has since August reduced the size of its structured investment vehicle portfolio from US$18.2 billion to the current US$7.15 billion.

Separately, the online edition also reported today that Hang Seng Bank yesterday acquired a 20% stake in mainland financial institution Yantai City Commercial Bank for HK$868 million to become the majority shareholder

Also Wing Lung bank will take 4.99% equity in Yantai, the second largest commercial bank in Shandong province.

The Standard also reported Jiangxa Copper will shutdown 43% or 300,000 tons of smelting capacity as a result of power outages until mid-February. Market analysts estimated that the closure will cost the company 2.3% or 12,500 tons of the expected output of 550,000 tons in 2007.

Realty stocks plummeted in Hong Kong as a result of the interest rate differentials between the Hong Kong Monetary Authority and financial institutions.

Most lenders slashed their prime rates by 25 basis points, while HKMA slashed its key rate by half percentage point.

Sun Hung Kai Properties tumbled 3.3% to HK$147.5 and Cheung Kong Holdings Limited shed 1.8% to HK$123.4 and Sino Land declined 8.5% to HK$21.5 as a result.

But a main land property lender, Agile Property, jumped 10% at HK$9.47.

Shipping lines gained on expectations that the Baltic Dry Index will continue to rise from last year’s slump. China Shipping Development surged 8.5% to HK$21.50, China COSCO increased 8.8% to HK$19.22, and Dry bulk shipper Pacific Basin advanced with a 12.2%.

Financial stocks gained as well. China Life gained 5.4 % to HK$29.5.