Chinese Economic Reports Lift HK, Asia Markets

123jump.com Staff
11 Sep, 2009
New York City

Stocks in Hong Kong and Shanghai advanced after a raft of economic data in China suggested rising economy. Data on retail sales, industrial production, money supply and urban investment for August were better than expected. Exports fell more than anticipated.

[R]9:00 PM Hong Kong – Stocks in Hong Kong and Shanghai advanced after a raft of economic data in China suggested rising economy. Data on retail sales, industrial production, money supply and urban investment for August were better than expected. Exports fell more than anticipated.[/R]

Stocks in China surged after the release of data on industrial output, consumer prices and investment loans. The strong economic data lifted stocks in Shanghai, Hong Kong, Korea and Australia. Exports from China fell at a faster pace than expected but domestic stimulus package of 4 trillion yuan is compensating for the weakness in the exports.

Hang Seng index in Hong Kong increased 91.86 or 0.44% to 21,161.42 and CSI 300 index in China higher 75.22 or 2.38% to 3,238.13.

The latest economic data showed healthier growth in economy than expected by most economists. National Bureau of Statistics reported industrial output in August increased 12.3% from 10.8% in July, one-year high.

Annual urban fixed-asset investment increased for the first eight months at 33% from 32.9% in July as investment in the property market and from businesses accelerated with the easy credit. Broadest measure of money supply, M2 increased at 28.53% in August according to People’s Bank of China.

Consumer prices in August fell 1.2% in August compared to a year ago after falling 1.8% in July. Seasonally adjusted retail sales increased 15.4% in August compared to a year ago.

Banks have been extending loans to businesses in construction and manufacturing as economic stimulus and accommodative monetary policy is supporting new projects. Banks loaned 410.4 billion yuan ($60 billion) in local currency in August, an increase from 355.9 billion in July.

Exports in August declined 23.4% compared to a year ago and increased 3.4% from July.

Gainers & Losers

Better than expected economic reports from China lifted industrials, banks and transportation companies.

Cathay Pacific Airways Ltd increased 2.9% to HK$12.08 on the hopes that traffic and fares will increase before the end of this month and HSBC lifted rating to “overweight” from “neutral.”

China Mobile increased 0.5% to HK$80 and China Unicom added 3.3% to HK$11.42.

Industrial & Commercial Bank of China increased 0.9% to HK$5.96 and Bank of Communications increased 1.8% to HK$9.85.

Li & Fung decreased 3.3% to HK$29.20 after reaching to a new high yesterday.

PetroChina Company Ltd increased 1.4% to HK$9.17 and Sinopec Shanghai Petrochemical Co increased 0.3% to HK$3.52.

Tencent Holdings Ltd increased 2.1% to HK$126.

Asian Markets Review

The Nikkei 225 Index in Tokyo closed lower 69.34 or 0.66% to 10,444.33, Hang Seng index in Hong Kong increased 91.86 or 0.44% to 21,161.42 and CSI 300 index in China higher 75.22 or 2.38% to 3,238.13. ASX 200 index in Australia increased 25.30 or 0.55% to 4,596.10. The FTSE Bursa KL Composite index in Malaysia closed higher 7.00 or 0.58% to 1,208.28.

The Kospi Index in South Korea increased 7.02 or 0.43% to close at 1,651.70. SET index in Thailand closed higher 4.72 or 0.67% to 707.81 and JSE Index in Indonesia increased 4.08 or 0.17% to 2,415.95. The Sensex index in India increased 47.44 or 0.29% to 16,264.30.