Stocks rise on economic optimism
Updated: 2010-11-09 06:50
(HK Edition)
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Hong Kong stocks rose, extending the benchmark index's gain to its highest level in more than two years, after a report last week showed the US added more jobs than estimated, fueling optimism in a global economic recovery.
The Hang Seng Index (HSI) gained 0.35 percent to 24,964.37. That boosted the measure's 14-day relative-strength index, which has been above 50 since September 2, to 77. That's above the 70 threshold that some traders use as an indicator to sell. The gauge fell as much as 0.6 percent Monday.
The Hang Seng China Enterprises Index advanced 0.7 percent to 14,204.13. Shares in the gauge trade at an average 15.8 times estimated earnings, compared with about 17.2 times at the start of the year.
China Merchants jumped 3.6 percent to HK$31.85. The company will form a venture that will buy 47.5 percent of a container-terminal operator in Nigeria for $154 million. China Merchants said it will initially hold 100 percent of the venture company, with the China-Africa Development Fund taking 40 percent after obtaining Chinese government approval.
Futures on the HSI rose 0.4 percent to 24,878. More than 10 stocks gained for every four that dropped among the measure's 45 constituents.
HSBC slid 1.6 percent to HK$86.70. The bank said profit growth slowed in the third quarter and that recovery in emerging markets may be faltering.
CSR Corp slumped 6.6 percent to HK$9.02. China's Ministry of Railways is reviewing high-speed rail proposals after a report by the China Academy of Science to the State Council raised questions about their practicality and affordability, the Financial Times reported.
ZTE Corp lost 1.8 percent to HK$30.15 after the Wall Street Journal reported that Sprint Nextel Corp won't consider products from ZTE and Huawei Technologies Ltd for a contract because of US government security concerns.
Bloomberg
(HK Edition 11/09/2010 page3)