HSBC Offering Draws Interest; HK Stocks Rise

123jump.com Staff
06 Apr, 2009
New York City

Stocks in Hong Kong gained 3% after HSBC received favorable response from investors. The troubled bank raised $18.5 billion through rights issue. HSBC closed up 5.3%. Separately, production of chemicals gained 2.4% in the first two months of this year.

[R]6:00AM New York, 6:00PM Hong Kong- HK stocks rise on HSBC rights issue. China’s chemical industrial output increases 2.4% in first two months.[/R]

Stocks in Hong Kong gained after HSBC’s $18.5 billion rights issue received overwhelming support from investors.

In Hong Kong trading Hang Seng Index gained 3.1% or 452.35 to 14,998.04, and the China Enterprises Index of Hong Kong listed mainland shares, or H shares, rose 2.7% or 56.80 to 2,171.15. In Shanghai trading CSI 300 Index fell 0.2% or 5.9 to 2,570.50.

Daily turnover on main-board declined to HK$62.2 billion from HK$71.4 billion yesterday.

HSBC Successful Offering

HSBC Holdings Plc said in a statement that investors purchased 172.7 million shares at 448 pence per share. The company has successfully placed 98% of 12.85 billion pounds offering.

The company had originally proposed to offer 5 for 12 rights issue at 254 pence per share to raise approximately £12.5 billion or $17.7 billion. The offering is expected to raise tier-1 ratio to 10% from 9%.

China’s Chemical Industrial Output Rises 2.4%

China’s Ministry of Industry and Information Technology reported on Friday last week that the country’s industrial production in the chemical sector gained 2.4% in the first two months of the year from the same period a year earlier.

Though output expansion was marginal, the contracting trend for the production of major chemical products eased.

The report notes that of the 30 chemical products production that was measured, production of the 21 chemicals dropped in the first two months, while for three products output recovered.

Output of three chemical fertilizers rose 4.6% to 8.75 million tons through January to February. Pesticide production advanced 9.1% to 390,000 tons in the first two months and production for February grew 14.4%.

The MIIT says industrial production edged up 5.2% in the first two months, with growth slowing from December.

China to Strengthen Regulation of Listed Securities

Xinhua News Agency reported today that China Securities Regulatory Commission on Saturday introduced a new regulation that makes it imperative for securities companies to remind investors about the potential risks when shareholders decide to launch a new business or introduce an innovative business.

The intervention follows the Securities Law, which took effect on April 3.

In addition, the annual report and half-year report by listed companies should also include risk assessment conditions and reasons for risk and probable effects.

Gainers & Losers

Hong Kong stock rose buoyed by news that investors took up 96.6% of HSBC shares in its $18.5 billion rights issue, with demand in HK soaring to 98.2%.

HSBC gained 5.3% to HK$52.0.

Shipping lines rose on expectations that trade will rebound. China Shipping Container Lines jumped 13.5%.

Hong Kong stocks gained on news that there were 74 deals on the 101 biggest housing estates. Sun Hung Kai Properties climbed 3.6% to HK$81.40 and Cheung Kong jumped 3.1%.

Agile Property Holdings increased 6.4 % after securing Rmb10 billion line of credit from the Industrial and Commercial Bank of China.