HK Stocks Rise, Macao Gambling Revenues Fall

123jump.com Staff
23 Feb, 2009
New York City

Stocks in Hong Kong closed higher on the speculation that the U.S. may increase its stake in the troubled lender Citigroup. The benchmark index in jumped 3.8% and in Shanghai increased 3.4%. Macao gambling revenues in January declined 5.3%. Gold in the region traded above $1,000 price.

[R]6:00AM New York, 6:00PM Hong Kong - China''s economy expected to rise 8% in 2009.[/R]

Market Sentiment

The benchmark stock index rose in Hong Kong buoyed by news that the U.S. government is presently in talks with Citigroup and might possibly increase its stake in the lender.

In Hong Kong trading Hang Seng Index rose 3.8% or 475.93 to 13,175.10, and the China Enterprises Index of Hong Kong listed mainland shares, or H shares, advanced 3.4% or 40.69 to 7,307.01. In Shanghai trading CSI 300 Index increased 2.8% or 66.16 to 2,410.48.

Citigroup in Talks with U.S. Government

Citigroup is in talks with U.S. regulators to convert $45 billion of preferred shares held by the government into common stock. Citigroup aims to retire a portion of its existing debt and increase the amount of common stock. The Wall Street Journal reported the news first and independently verified by 123jump.com.

Citigroup also intends to persuade private holders of preferred shares Abu Dhabi Investment Authority, the Government of Singapore Investment Corporation, and the Kuwait Investment Authority to convert their holdings to common stock.

China Forecasted to Grow 8% in 2009

Xinhua News Agency reported today that Bank of Communications chief economist Lian Ping said China''s gross domestic product is expected to grow at 8%.

Lian said economic indicators show that the economy is working its way out of the toughest phase.

Macao Gaming Tax Revenue Falls 5.3%

Macao Post Daily Online reported today that Macao Special Administrative Region saw its gaming tax income decline 5.3% in January. However, gaming taxes accounted for 82.3% of the region''s total revenues (3.55 billion patacas) in January.

The SAR government''s income from direct gaming taxes rose 34.8% to 39.56 billion patacas for 2008.

Gainers & Losers

Hong Kong stocks jumped 3.8% on speculation the government will shore up its stake in Citigroup. Increases were however pared on rising concern over corporate earnings.

HSBC rose 0.9%.

Commodity related stocks climbed as gold prices rose 2.6% to $1,002 per
ounce. Zijin Mining increased 4.5% to HK$4.91.

Energy stocks rose as oil prices crept to $40 per barrel. CNOOC advanced 4.3% to HK$7.02 and PetroChina edged up 3.3% to HK$5.93.