Hong Kong Stocks Fluctuate Ahead of China Growth Report

Hong Kong stocks swung between gains and losses ahead of economic data tomorrow that may show China’s economic growth accelerated for the first time in eight quarters, while concern remained that shares have risen too far, too fast.

Sun Hung Kai Properties Ltd. (16) gained 0.4 percent after the real estate developer’s rating was raised at DBS Vickers (Hong Kong) Ltd. HSBC Holdings Plc rose 0.8 percent, headed toward its highest level in 20-months. Brightoil Petroleum Holdings Ltd., a supplier of marine fuel, slumped 11 percent after saying it’s seeking waivers from lenders to prevent a possible loan default.

The Hang Seng Index fell 0.4 percent to 23,270.95 at the midday trading break in Hong Kong after gaining as much as 0.6 percent. The Hang Seng China Enterprises Index of mainland companies fell 0.9 percent to 11,795.77.

“The market is in a consolidation period and we need better news from China for it to rise,” said Steven Leung, a Hong Kong-based institutional sales director at UOB Kay Hian Ltd. “Until investors see the Chinese economic numbers tomorrow, they may still be cautious. We may see some choppy moves until then.”

Hong Kong’s benchmark index surged 23 percent last year as China’s economy showed signs of improvement and as central banks around the globe added stimulus. Shares on the measure traded at 11.4 times estimated earnings yesterday, compared with 13.3 for the Standard & Poor’s 500 Index and 12 for the Stoxx Europe 600 Index, according to data compiled by Bloomberg.

China GDP

The National Bureau of Statistics may report tomorrow that gross domestic product expanded 7.8 percent in the fourth quarter from a year earlier, according to the median estimate of 53 economists surveyed by Bloomberg News. That’s up from a three-year low of 7.4 percent in the previous period.

The Hang Seng Index fell the last two days after reaching its highest level in 18-months on Jan. 14. The Hang Seng Volatility Index (VHSI) rose 1.3 percent to 14.99, indicating options traders expect a swing of 4.3 percent in the next 30 days. Futures on the Hang Seng Index (HSI) fell 0.4 percent to 23,260. Volume on the measure was 16 percent below its 30-day average today.

To contact the reporter on this story: Anna Kitanaka in Tokyo at akitanaka@bloomberg.net

To contact the editor responsible for this story: Nick Gentle at ngentle2@bloomberg.net

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