Connect to share and comment

Hong Kong stocks close 0.21% higher

PlacardEnlarge
(Globalpost/GlobalPost)

Hong Kong stocks rose 0.21 percent on Tuesday, reversing earlier losses on bargain hunting but traders remain concerned about a liquidity crisis in China's banking system.

The benchmark Hang Seng Index ended 41.74 points higher at 19,855.72 on a turnover of HK$92.87 billion (US$11.98 billion).

The morning trade began positively as investors bought recently-battered property shares but the early gains were knocked out by widespread selling pressure in China which tipped most Asian markets into the red.

As Shanghai began to recover, so too did Hong Kong with traders saying confidence was renewed by rumours that government-related funds were suspected of buying heavyweight bank stocks in the mainland to help revive investor confidence.

Hao Hong, managing director for research at Bank of Communications International, told the Dow Jones newswires that investors also took heart after a turbulent fortnight from an afternoon meeting convening the People's Bank of China and state banking, securities and insurance regulators.

"We are down almost 20 percent in two weeks," Mr. Hong said. "It's ferocious."

Property shares in Hong Kong closed the session with the strongest gains, rising 1.3 percent. Henderson Land rose 1.9 percent to HK$45.25 and Hang Lung Properties rose 2.6 percent to HK$26.15.

Bank of East Asia, a major Hong Kong bank, closed down 1.28 percent to 26.90 HK dollars whilst local stock exchange operator HKEX lost 1.55 percent to 114.10 HK dollars.

In China shares closed down 0.19 percent, their lowest level in more than four years amid persistent worries over a domestic liquidity squeeze, dealers said.

The benchmark Shanghai Composite Index ended down 3.73 points at 1,959.51 on turnover of 104.7 billion yuan ($17.0 billion). The close was the lowest since January 16, 2009.

Brokerages were hardest hit on Tuesday, with China Everbright Securities losing 4.23 percent to 9.74 yuan and Industrial Securities falling 3.09 percent to 9.09 yuan.

Cement producers also fell, with Zhejiang Jianfeng Group dropping 4.07 percent to 8.72 yuan and Shaanxi Qinling Cement falling 2.57 percent to 4.17 yuan.

But banking shares rebounded after earlier losses. Industrial and Commercial Bank of China rose 1.54 percent to 3.96 yuan and Agricultural Bank of China climbed 1.21 percent to 2.51 yuan.

dan-jta/ia

http://www.globalpost.com/dispatch/news/afp/130625/hong-kong-stocks-close-021-higher-0