Hong Kong Stocks Snap Two-Day Advance Before China Data

Hong Kong stocks slipped, with the city’s benchmark index retreating for the first time in three days, before the release of data on Chinese industrial production and retail sales.

The Hang Seng Index decreased 0.1 percent to 23,778.74 as of 9:31 a.m. in Hong Kong. The Hang Seng China Enterprises Index (HSCEI) of mainland companies listed in the city dropped 0.3 percent to 11,403.18.

Chinese industrial production probably expanded more than 10 percent for a fourth month in November, according to economists surveyed before a report due today. The world’s second-largest economy is also scheduled to post retail sales data, after higher-than-expected export growth fueled stock gains yesterday. The global economy will strengthen in 2014 as U.S. and euro-area output improves, said Mohamed El-Erian, chief executive officer of Pacific Investment Management Co.

The Hang Seng Index (HSI) climbed 20 percent from its June low through yesterday amid signs China’s economy is stabilizing. The measure traded at 11.3 times estimated earnings, compared with 16.2 for the Standard & Poor’s 500 Index.

The H-share index, as the gauge of Chinese companies listed in Hong Kong is known, climbed 29 percent from this year’s low on June 25 through yesterday, extending gains after China unveiled sweeping reform plans.

Futures on the S&P 500 added 0.1 percent today. The gauge rose to a record yesterday as investors weighed the timing of any cuts to Federal Reserve monetary support amid budget negotiations in Washington.

Fed policy makers will probably begin reducing $85 billion in monthly bond buying at a Dec. 17-18 meeting, according to 34 percent of economists surveyed on Dec. 6 by Bloomberg, an increase from 17 percent in a November survey. In November, 53 percent predicted a tapering in March, compared with 40 percent in the most recent poll of 35 economists.

To contact the reporter on this story: Jonathan Burgos in Singapore at jburgos4@bloomberg.net

To contact the editor responsible for this story: Sarah McDonald at smcdonald23@bloomberg.net

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