Hong Kong Stocks Rise for Fifth Week, Longest Streak Since 2010
Hong Kong stocks rose for the fifth week, the longest streak since October 2010, with the Hang Seng Index (HSI) closing at a six-month high, on speculation China may take more measures to boost economic growth.
Banks advanced, led by China Minsheng Banking Corp., the nation’s first non-state lender, which rose 1.4 percent. Hutchison Whampoa Ltd. (13), owned by Hong Kong billionaire Li Ka- shing, gained 3.3 percent after it agreed to buy a mobile-phone operator in Europe. Sinopharm Group Co. (1099), China’ largest drug distributor, surged 12 percent after China’s Ministry of Health said it will increase the subsidy for medical insurance.
“Though China’s growth is slowing, it won’t be a hard landing,” said Zhang Ling, general manager at Shanghai River Fund Management Co. “Monetary policy is starting to ease and the market’s expectations of a reserve-requirement cut are rising. Stocks are also really cheap now.”
The Hang Seng Index rose 0.1 percent, to 20,756.98 at the close. The gauge advanced 1.3 percent this week, its fifth straight week of gain, as manufacturing in China, the U.S. and Europe increased. The Hang Seng China Enterprises Index (HSCEI) of mainland companies listed in the city gained 0.2 percent to 11,605.57 today.
Stocks climbed on speculation slowing economic growth will push the Chinese central bank to relax monetary policies. The measure trades at 10.5 times estimated earnings, from a low of 7.7 times on Oct. 24, according to weekly data compiled by Bloomberg.
China Minsheng rallied 1.4 percent to HK$7.52. China Construction Bank Corp. (939), the nation’s No. 2 lender by market value, rose 0.8 percent to HK$6.39. Agricultural Bank of China Ltd., the nation’s third-biggest lender by market value, gained 0.5 percent to HK$3.92.
Hutchison Whampoa advanced after agreeing to buy Orange Austria from France Telecom SA in a deal that values the mobile carrier at 1.3 billion euros ($1.7 billion). Hutchison rose 3.3 percent to HK$76.40.
Sinopharm rose 12 percent to HK$20.55 on the plan, which will raise subsidies to about 300 yuan ($47.60) per capita in rural China this year. That’s more than the expected 240 yuan, CIC analyst Jessica Li said by phone today.
Wynn Macau Ltd., the Hong Kong-listed casino unit of Wynn Resorts Ltd. (WYNN), slipped 2.4 percent to HK$20.30 percent after posting profit that missed estimates. Shares dropped after the casino operator posted full-year profit of $759.8 million, missing analysts’ estimates of $795.3 million.
Casino Stocks Fall
Other gambling stocks declined. MGM China Holdings Ltd., a unit of the largest operator on the Las Vegas Strip, dropped 0.2 percent to HK$11.86. SJM Holdings Ltd., Asia’s biggest casino, slipped 1.8 percent to HK$14.30.
Futures on the Hang Seng Index retreated 0.1 percent to 20,755 today. The HSI Volatility Index (VHSI) dropped 3.9 percent to 21.77 today, indicating traders expect a swing of 6.2 percent on the benchmark over the next 30 days.
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