Weak Land Auction in HK; China Firm on Yuan

123jump.com Staff
28 Dec, 2009
New York City

Stocks in Shanghai rose after comments from Chinese Premier Jiabao. China to resist pressures to appreciate the currency and will look for ways to curb the current property market boom. Hong Kong stocks fell after weaker than expected land auction.

[R]6:00 AM New York, 6:00 PM Hong Kong – Stocks in Shanghai rose after comments from Chinese Premier Jiabao. China to resist pressures to appreciate the currency and will look for ways to curb the current property market boom. Hong Kong stocks fell after weaker than expected land auction.[/R]

Hong Kong stocks dropped after a government land auction was priced below expectations, but stocks in Shanghai rose after China’s premier Wen Jiabao said the stimulus measures taken by Beijing have been effective.

China also forecasts that it will overtake Germany as the world’s largest exporter this year.

In Hong Kong trading Hang Seng Index fell 0.2% or 36.78 to 21,480.22, and the China Enterprises Index of Hong Kong listed mainland shares, or H shares, decreased 0.03% or 4.22 to 12,669.52. In Shanghai, CSI 300 Index rose 1.6% or 53.65 to 3,478.43.

Daily turnover on main-board increased to HK$37.89 billion from HK$27.55 billion on Thursday’s shortened session.

Jiabao Holds Firm on Yen and Lauds Stimulus

Xinhua News Agency reported that China’s Premeir Wen Jiabao said yesterday the country’s stimulus packages had been effective, but challenges still remain.

Wen noted Beijing will continue pro-growth economic policies and implement measures to curb property speculation and maintain consumer prices at reasonable levels.

According to the report, the Chinese premier said the country has resisted calls to appreciate the yuan, saying the measure was specifically meant to check China’s development.

The global financial crisis has affected coastal manufacturing regions, including Guangdong, Zhejiang and Jiangsu, and dented the country’s export-oriented growth.

“We have stabilised the economy and employment and maintained social stability over the past one year,” said Wen.

China to Become World’s Largest Exporter

China Daily reported today the country’s ministry of finance said China will surpass Germany as the world’s largest exporter this year.

Exports are, however, forecasted to decline 16.5% to $1.2 trillion from a year ago.

China’s vice minister of commerce Zhong Shan said imports are likely to drop 15% to $963 billion in the period.

“It’s very likely that China will take over Germany this year as the world’s biggest exporter and that the share of China’s exports in world exports will rise nine percent this year from 8.86 percent last year,” said Zhong.

HK Stocks Rise 1.3% in Nov

Census and Statistics Department reported today the value of total exports of goods rose 1.3% to $234.1 billion in November from the same period a year ago.

Imports also advanced 6.5% to $254.8 billion in the period.

Total exports to Asia grew 8% leveraged by increases to Vietnam 37.2%, Taiwan 18.3%, Korea 16.9%, India 16.7% and mainland China 8.9%.

But exports fell to the United States by 12%, 10.6% to United Kingdom, by 7.3% to Singapore and Germany 0.6%.

A spokesman from the department said, “the global economic prospects, particularly those of advanced economies, are still subject to considerable uncertainties.”

Gainers & Losers

Hong Kong property stocks declined after the government sold two plots, the first major auction in two years, below prices that were projected.

Henderson Land dropped 2%, Sun Hung Kai Properties decreased 1.3%, Cheung Kong tumbled 1% and New World Development plunged 0.4%.
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China Mobile gained 0.3% to HK$69.80 on news its vice-chairman Zhang Chunjiang is under investigation for breaching regulations.

Sino-Ocean Land increased 3.8% to HK$7.06 after announcing it will sell a 16.57% stake to China Life for HK$5.82 billion.

China Resources Gas edged up 16.8% to HK$10.14 after saying it will buy 25% of a city gas distribution joint venture in Chongqing for Rmb1.16 billion.

Geely Auto fell 0.5% to HK$4.24.

Shanghai stocks rose on Wen Jiabao’s comments.

Brokerage firms gained. CITIC Securities advanced 3.6% to Rmb29.86 and Haitong Securities jumped 2.2% to Rmb 18.38.

Gezhouba Group increased 2.6% to Rmb11.74 after estimating its earnings will gain 60% in 2009 from a year ago.