Hong Kong stocks rose, with the benchmark index advancing the first time in three days, as energy shares gained on concern possible U.S. military action in Syria may disrupt the flow of oil from the Middle East. China Life Insurance Co. gained on a first-half jump in profit.
The Hang Seng Index (HSI) rose 0.6 percent to 21,658.71 as of 9:32 a.m. in Hong Kong, rebounding from the biggest decline since Aug. 20. About five shares rose for each that fell on the 50-member gauge, which is headed for an 1.1 percent monthly drop amid expected cuts to U.S. stimulus next month. The Hang Seng China Enterprises Index today added 1.3 percent to 9,888.98.
Hong Kong’s equity benchmark retreated 5 percent this year through yesterday, the second-worst performer among developed markets tracked by Bloomberg. The gauge traded at 10.3 times estimated earnings as of yesterday, compared with 14.8 for the Standard & Poor’s 500 Index and 13.6 on the Stoxx Europe 600 Index, according to data compiled by Bloomberg.
The Hang Seng China Enterprises Index, also known as the H-share index, dropped 20 percent through yesterday from a Feb. 1 high on concern over China’s economy after a two-quarter slowdown in growth. The measure traded at 1.18 times book value yesterday, compared with a five-year average of 1.77.
Futures on the S&P 500 fell 0.1 percent. The measure rebounded yesterday from an eight-week low as energy shares surged after crude rose to a two-year high. The U.S. and the U.K. yesterday said they are prepared to take military action against Syria without authorization from the United Nations Security Council over that nation’s alleged used of chemical weapons against its own people.
A report today may show the U.S. economy grew more last quarter than previously estimated, adding to expectations the Federal Reserve may start curtailing bond purchases next month. Economists surveyed by Bloomberg project gross domestic product expanded 2.2 percent in the second quarter, up from the earlier official forecast of 1.7 percent.
Speculation the Fed will taper stimulus has weighed on equities in recent weeks. The central bank is expected to pare asset purchases in September by $10 billion to a $75 billion monthly pace, according to economists surveyed by Bloomberg on Aug. 9-13.
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