Ping An Obtains Approval

123jump.com Staff
05 Mar, 2008
New York City

Hong Kong stocks continue to struggle ahead of a large public offering from insurer Ping An. Hang Seng index is now down 30% from its peak in October 2007. Telecom stocks rallied ahead of the expected consolidation. Mobile operators China Mobile added 0.5% and China Unicom increased 7.5%. China Telecom increase 2.5%, while China Netcom climbed 6.2%.

[R]6:00AM New York, 6:00PM Hong Kong – Hong Kong stocks are down 30% from the peak. Cathay Pacific annual profit rose 72%.[/R]

Stocks in Hong Kong fell in volatile trade as gains in the telecommunications failed to forestall a market slump driven by worries over the global economy and declining oil prices.

In Hong Kong trading the Hang Seng Index declined 0.02% at 23,114.34 and the China Enterprises index of H shares, or Hong Kong-listed shares in mainland companies, dropped 0.96% to 12,847.95.

Daily turnover on main-board turnover was HK$79.8 billion compared to HK84.1 billion yesterday.

China becomes third largest export

The People’s Daily Online reported today that the U.S. annual trade report noted China has surpassed Japan to become to become the third largest export market for the U.S. goods in 2007.

Goods exports increased by 17% for the eight straight year of double-digit growth in 2007, and exports of foods, feeds and beverages, as well as automobiles and automotive parts surged 40% and 38% correspondingly. Capital goods accounted for 45% of U.S. exports to China in 2007 and exports of industrial supplies accounted for a 38% increase.

In addition foods, feeds and beverages, and automobiles and automotive parts contributed 9% and 3% in that order. Agriculture exports rose 13% in 2007, making up 12% of total U.S. exports to China.

No inflationary spiral expected in China

Xinhua News Agency reported today that newly appointed senior vice president of the World Bank and a deputy to the 11th National People''s Congress Justin Yifu Lin said China will not have an inflationary spiral this year and forecasted that the economy will grow between 9% and 10%. Private economists continue to worry that rising trade deficit has kept new bubble forming in stocks and property markets.

Gainers & Losers

Telecommunication stock rose on renewed speculation that the sector will be restructured, helping facilitate participation by small companies.

Mobile operators China Mobile surged 0.53% to HK$114.40 and China Unicom increased 7.46% to HK$17.00 as a result. Also fixed line operators gained as well. China Telecom increase 2.52% to HK$5.70, while China Netcom climbed 6.18% to HK$24.05.

Ping An Insurance Co gained 0.7% to HK$56.40 on speculation shareholders will approve the company’s plan to pool $17 billion for overseas acquisitions.

Cathay Pacific Airways rose 0.7% to HK$16.32 after posting a 72% increase in annual profit on higher ticket prices and increasing passenger demand.

Energy stocks declined as crude oil prices fell 2.9% to $99.52 a barrel. PetroChina Co Ltd fell 0.37% to HK$10.78 and CNOOC Ltd shed 2.15% to HK$11.86. Nickel miner Xinxin Mining declined 5.68% at HK$6.98 on profit taking, while coal companies China Shenhua and China Coal fell 2.6 % at HK$37.40 and 6.05% to HK$14.90 respectively.

Also, Hong Kong Exchanges and Clearing Ltd declined 0.42% to HK$141.00. The company was due to report its results after the markets closed.