ICBC Earnings Oulook Lift Financials

123jump.com Staff
10 Apr, 2008
New York City

ICBC estimated earnings gain for the first quarter of this year to rise at least 50%, lifting stocks in the financial sector. China Construction Bank gained 4% ahead of its earnings tomorrow. Higher crude prices crimped margins at refiners, dragging the sector lower. China statics agency revised higher its estimate for economic growth in 2006 and 2007.

[R]6:00AM New York, 6:00 Hong Kong - China revises GDP to 11.9% for 2007 and ICBC estimated at least 50% rise in earnings.[/R]

Hong Kong stock averages gained after positive earnings forecast from the International Commercial Bank of China lifted stocks in financial sector.

Market sentiment

In Hong Kong trading the Hang Seng Index rose 0.84% or 202.53 to 24,187.10, and the China Enterprises Index of Hong Kong-listed mainland companies, or H shares, advanced 1.04% or 134.41 to 12,998.21.

In Shanghai trading, CSI 300 Index gained 1.81% or 66.59 to 3,754.72.

Daily turnover on main-board was HK$74.81 billion from HK$83.41 billion yesterday.

China revises 2007 GDP to 11.9%

The National Bureau of Statistics today revised upwards its gross domestic product for 2007 to 11.9%, which is 0.5% higher than its earlier forecast. According to the agency, GDP growth was revised by Rmb 291.1 billion more than originally forecasted at Rmb 24.953 trillion last year.

The NBS also said 2006 GDP was Rmb 21.1923 trillion, up 105.2 billion from the original forecast or 11.6% higher from 2005.

China’s currency rises the most in three years

Xinhua News Agency reported today that China’s currency, the yuan, traded at 6.9920 yuan against the U.S. dollar breaching the 7 yuans to dollar parity since 2005. The U.S. dollar continues to be dragged by the turmoil in the U.S. credit market and expectations more decline in interest rates.

China’s currency has gained 4.47% this year.

Gainers & Losers

Financial stocks rose after Industrial and Commercial Bank of China estimated a rise in first quarter earnings.

ICBC reported today that net profit in the first quarter increased at least 50%. China Construction Bank also climbed 3.7% on optimism on earnings to be released tomorrow.

Oil refiner Sinopec Corp fell 1.6% to HK$6.90 after crude prices advanced above $112 a barrel as higher oil price only affects its margin. China determines price of petroleum products at the pump. PetroChina declined 1.8% as well.

Shenhua Energy increased 1.6% after Reuters reported that it planned to buy assets worth $1.6 billion from its state parent.

And TPV Technology also rose 5% to HK$5.04 after it posted a 19% increase in 2007 earnings on higher shipments and said it was targeting a marked expansion in market share.

China communications to tender for bridge project

The Standard news reported today that China Communications Construction is preparing a bid for the Hong Kong-Guangdong-Macau bridge project worth Rmb70 billion.

Chairman of the company Zhou Jichang said yesterday he was not sure whether China Railway Construction and China Railway will participate in the bidding.

Zhou said the company plans to actively expand its overseas business, mainly in infrastructure construction, with capital expenditure of Rmb 14.3 billion in 2008.