Jintao Commets Lift China Stocks

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

Positive comments from the President Jintao lifted stock market averages in Hong Kong and Shanghai. His comments appeared pro growth, lifting stocks in the banking and industrial sectors. China reported urban unemployment dropped in the first half to 4%. Hong Kong in the first fiscal quarter ending in June reported a deficit of HK$16.5 billion and in June of HK$10.8 billion.

[R]6:00AM New York, 6:00PM Hong Kong - HK trade deficit rises to HK$10.8 billion in June. Shanghai Electric fell 4% on weaker margins.[/R]

Stocks in Hong Kong overcame a dip in the morning session after China President Hu Jintao indicated that Beijing will soon shift from its monetary tightening stance.

Market Sentiment

In Hong Kong trading Hand Seng Index rose 0.58% or 131.50 to 22,862.60, and the China Enterprises Index of the Hong Kong listed mainland shares, or H shares advanced 0.31% or 38.48 to 12,545,22. In Shanghai trading CSI 300 Index increased 1.27% or 35.58 to 2,840.79.

Daily turnover on main-board was HK$60.7 billion compared with HK$56.5 billion yesterday.

HK Trade Deficit of HK$10.8 billion

The Census and Statistics Department reported yesterday that the Hong Kong government realized a trade deficit of HK$10.8 billion in June and a deficit of HK$16.5 billion in the first quarter ending in June of the current fiscal year.

During the month, the government revenues were HK$10.2 billion and spent HK$21billion, while in the quarter to June revenues collected increased to HK$43.2 billion and spending soared to HK$59.7 billion. Fiscal revenues jumped to HK$476.4 billion at the end of June.

China’s Unemployment Drops to 4%

Xinhua News Agency reported on its Web site that the Ministry of Human Resources and Social Security (MHRSS) said China’s registered urban and township unemployment rate was at 4 % in the first half of the year, which is 0.2 percentage point lower than the same period a year ago.

About 8.35 million people were registered as unemployed across the country''s urban areas and townships in the first half.

MHRSS said the government managed to create 6.4 million new jobs in the first half, which represents 64% of the annual set target of 10 million, while 2.82 million workers that were laid-off found new employment in the same period, which is 56% of the targeted 5 million.

The statistics showed that 788,000 people found employment in the provinces of southwest Sichuan, and northwest Gansu and Shaanxi.

Gainers & Losers

Hong Kong stock indexes rebounded from losses in the morning session after Beijing intimated that it will shift from its tightening monetary stance.

Financial stocks also rose on comments made by Chinese President Hu Jintao that appeared pro growth. China Construction Bank gained 1.5% and China Life advanced 1.3%.

Shanghai Electric Group Co Ltd fell 4.3% on the media reports that the company’s profit margins will drop by 3 percentage points due to soaring steel prices.

Retailer Esprit Holdings declined 2.7% on falling retail sales in German.

Asian Markets Review

The Nikkei 225 Index in Tokyo closed lower 282.22 or 2.11% to 13,094.59, Hang Seng index in Hong Kong increased 131.50 or 0.58% closed to 22,862.60. ASX 200 index in Australia decreased 73.40 or 1.47% to close 4,904.00. The KL Composite index in Malaysia decreased 3.99 or 0.34% closed to 1,159.10.

The Kospi Index in South Korea decreased 20.90 or 1.31% to close at 1,573.77, SET index in Thailand closed higher 2.34 or 0.35% to 678.66 and JSE Index in Indonesia decreased 55.76 or 2.42% to 2,248.75. The Sensex index in India increased 300.94 or 2.10% to 14,656.69.