Hong Kong Stocks Advance on China Economic Data, Casinos

Hong Kong stocks rose, with the city’s benchmark index paring its weekly decline, as China’s exports beat estimates and inflation slowed. Gaming shares rose on a report Macau hotels are full for next week’s Lunar New Year holiday.

Galaxy Entertainment Group Ltd., a casino operator founded by billionaire Lui Che-Woo, rose 3.9 percent. China Minsheng Banking Corp. slumped 2.6 percent after the lender’s 20 billion yuan ($3.21 billion) convertible-bond sale was approved. Soundwill Holdings Ltd. jumped 6.1 percent after Daiwa Securities Group Inc. raised the developer’s target price.

The Hang Seng Index added 0.2 percent to 23,215.16 at the close after falling as much as 0.3 percent. The gauge lost 2.1 percent for the week, the steepest such decline since November. About two stocks rose for each that fell on the gauge today, with trading volume about 9.5 percent above the 30-day average for the time of day. The Hang Seng China Enterprises Index of mainland companies lost 0.3 percent to 11,649.78.

“Many investors are taking a wait-and-see attitude” before the Lunar New Year holidays, said Peter Lai, director of sales at brokerage DBS Vickers Hong Kong Ltd. “China’s economy is picking up. I’m still bullish on the market for this half of this year because of fund flows. For the second half, we are not sure if figures coming from the U.S., China and Europe will be positive, and Europe’s debt could be a problem again.”

Hong Kong’s market will be shut three days next week for the Lunar New Year holidays, while markets in mainland China will be closed all week. The Hang Seng Index surged 22 percent from the end of August through January, when the gauge capped its longest monthly winning streak since July 2009. Shares rose amid signs of recovery in the U.S. and China, and as central banks around the globe added stimulus.

Inflation Report

China’s consumer prices rose 2 percent from a year earlier, decelerating from a 2.5 percent gain a month earlier, the government said. A separate report showed China’s exports rose 25 percent in January from a year earlier, exceeding the 17.5 percent median of economists’ estimates.

Galaxy Entertainment climbed 3.9 percent to HK$33.55. SJM Holdings Ltd., founded by tycoon Stanley Ho, jumped 7.6 percent to HK$20.50. Wynn Macau Ltd. added 4.4 percent to HK$20.30.

Seventeen major casino hotels in Macau were fully booked from Feb. 12 through Feb. 14 for the Chinese holiday, according to Karen Tang, a Hong Kong-based analyst at Deutsche Bank AG. The surge may help boost monthly gaming revenue 15 percent from a year earlier to $27.9 billion patacas ($3.5 billion), she said.

Soundwill rose 6.1 percent to HK$22.70 after Daiwa Securities raised the Hong Kong property manager’s target price to HK$28.40 from HK$13.95, while maintaining its buy rating.

Europe’s Recovery

Futures on the Standard & Poor’s 500 Index rose 0.1 percent. The gauge yesterday slid 0.2 percent as corporate earnings reports disappointed and European policy makers warned the euro’s advance could hamper the region’s recovery.

China Minsheng dropped 2.6 percent to HK$10.72. The China Securities Regulatory Commission approved the lender’s convertible-bond sale, according to a statement to the Shanghai Stock Exchange yesterday.

Futures on the Hang Seng Index climbed 0.2 percent to 23,242. The HSI Volatility Index rose 0.2 percent to 14.25, indicating traders expect a swing of 4.1 percent for the equity benchmark in the next 30 days.

To contact the reporter on this story: Kana Nishizawa in Hong Kong at knishizawa5@bloomberg.net

To contact the editor responsible for this story: John McCluskey at j.mccluskey@bloomberg.net

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