Hong Kong Stocks Rise on China Stimulus, City Home Sales
Hong Kong stocks rose as China’s services industry weakened, stoking speculation the nation will step up measures to stimulate the world’s second-largest economy, and as realtors forecast the most home sales in six years in the island city.
Yue Yuen Industrial Holdings Ltd., which makes shoes for Nike Inc., rose 1.5. New World Development Co. (17), the Hong Kong property company controlled by the family of billionaire Cheng Yu-tung, gained 1.7 percent as realtors said demand for homes is increasing amid expectations for prolonged low-interest rates. China Construction Bank Corp., the nation’s second-largest lender, rose 1.3 percent, leading financial stocks higher.
The Hang Seng Index (HSI) gained 0.6 percent to 20,957.26 as of 10:26 a.m. local time, after being closed the past two days for a local holiday. The Hang Seng China Enterprises Index of mainland companies added 0.6 percent to 9,892.32. Markets in mainland will remain closed through Oct. 5.
“China’s economy is decelerating and will probably achieve a soft landing,” said Khiem Do, Hong Kong-based head of multi- asset strategy at Baring Asset Management (Asia) Ltd., which oversees about $8 billion. “China will introduce additional stimulus measures in their own time.”
China’s non-manufacturing industries expanded at the weakest pace since at least March 2011 as officials struggle to reverse an economic slowdown, a report showed today.
The purchasing managers’ index fell to 53.7 from 56.3 in August, the National Bureau of Statistics and China Federation of Logistics and Purchasing said in Beijing. Readings above 50 indicate expansion.
Hong Kong developers, seeking funds to tap an expanding government land supply, are this month preparing to sell the most homes in six years as expectations for prolonged low- interest rates fuel demand.
Real-estate companies led by New World Development, this year’s best performer in Hong Kong’s benchmark property gauge, may sell more than 3,300 units from eight new projects in October, according to Buggle Lau, chief analyst at Midland Holdings Ltd., the city’s biggest publicly traded realtor. That would be the highest monthly figure since August 2006, Lau said.
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