Chinese Markets Surge on Manufacturing Indexes

123jump.com Staff
03 Aug, 2009
New York City

Chinese stocks surged ahead on the release of two separate manufacturing reports. The reports indicated that manufacturing sector is expanding and export linked activities are recovering. China Vanke first half profit increased 22%. China Everbright filed to raise $1.6 billion.

[R]8:00 PM Hong Kong, 8:00 AM New York – Chinese stocks surged ahead on the release of two separate manufacturing reports. The reports indicated that manufacturing sector is expanding and export linked activities are recovering. China Vanke first half profit increased 22%. China Everbright filed to raise $1.6 billion.[/R]

Two separate reports on manufacturing industry suggested that the sector is still expanding. The government reported suggested that index of purchasing manager’s increased to 53.3 in July from 53.2 in June. CLSA China Purchasing Managers’ Index increased to 52.8 in July from 51.8 in June.

The index above 50 indicates expansion. Rising domestic consumption and smaller decline in exports is also contributing to the rise in manufacturing.

Hang Seng index in Hong Kong increased 233.93 or 1.14% to 20,807.26 and CSI 300 index in China higher 52.41 or 1.40% to 3,787.03.

Gainers & Losers

China Vanke Company decreased 0.4% to 11.06 yuan after it reported first half profit increased 22% to 2.52 billion yuan and sales increased 25% to 20.6 billion yuan.

China Everbright Group unit Everbright Securities Compay filed to raise 10.96 billion yuan or $1.6 billion. The brokerage house will list its stock on Shanghai Stock Exchange and expects to sell 520 million shares at a price between 19 and 21 yuan each according to the filing. The offering is valued at 59 times earnings.

HSBC Holdings increased 0.9% to HK$77.80 and after the market closing the bank reported net profit surprising most analysts.

Cosco Pacific Limited surged 16.5% to HK$12.60 after the official manufacturing index suggested a rise in export orders and higher activities at ports. Shanghai Port soared 4.8% to 6.37 yuan on the speculation that international trade is recovering ahead of traffic report on August 10. China Cosco Holdings Company surged 8.1% to 19.99 yuan.

Mining and metals companies surged after the manufacturing report. Jiangxi Copper increase 6% to HK$18.94.

Alibaba.com Limited added 4% to HK$18.5

China Railway Group Ltd surged 7% to HK$2.99 after the company signed an agreement for $7.5 billion to build railways in Venezuela.

VanceInfo Technologies surged 11% to $16.85 in New York trading after JP Morgan recommended the stock and made positive comments.

Sinopec Shanghai Petrochemical Company soared 10% to HK$3.93 after the company’s stake in a joint venture with BP and Sinopec expanded its ethylene plant capacity in Shanghai by 32%.

Asian Markets Review

The Nikkei 225 Index in Tokyo closed lower 4.36 or 0.04% to 10,352.47, Hang Seng index in Hong Kong increased 233.93 or 1.14% to 20,807.26 and CSI 300 index in China higher 52.41 or 1.40% to 3,787.03. ASX 200 index in Australia increased 19.40 or 0.46% to 4,263.40. The FTSE Bursa KL Composite index in Malaysia closed lower 3.59 or 0.31% to 1,171.31.

The Kospi Index in South Korea increased 7.69 or 0.49% to close at 1,564.98. SET index in Thailand closed higher 17.43 or 2.79% to 641.43 and JSE Index in Indonesia increased 15.56 or 0.67% to 2,338.80. The Sensex index in India increased 253.92 or 1.62% to 15,924.23.