July 23 (Bloomberg) -- Hong Kong stocks rose, lifting the benchmark index to a one-month high, after U.S. companies lifted profit forecasts, and Microsoft Corp. posted better-than-estimated earnings, fueling optimism of a global economic recovery.
Esprit Holdings Ltd., a global fashion retailer, advanced 4.1 percent. Cosco Pacific Ltd., Asia’s third-biggest container-terminal operator, climbed 4.3 percent. New World Development Co., which got 26 percent of its fiscal 2009 revenue from China, climbed 3.7 percent after Shanghai Shimao Co., a mainland developer, said its first-half net income may rise 700 percent.
“The earnings forecasts lifted investor sentiment,” said Yoji Takeda, head of the Asian equity management team at RBC Investment (Asia) Ltd., which oversees $1.1 billion. “Whether the market rally can be sustained depends on earnings due to be released later.”
The Hang Seng Index gained 1.1 percent to close at 20,815.33, the highest level since June 23, extending its advance this week to 2.8 percent. The Hang Seng China Enterprises Index of so-called H shares of Chinese companies climbed 1.4 percent to 11,915.58.
The Hang Seng Index has dropped 4.8 percent this year as China’s efforts to cool its property market and Europe’s debt crises dented confidence in a global economic recovery. Stocks on the gauge trade at 13.8 times estimated earnings, Bloomberg data show, down from 17.2 times at the beginning of the year.
Export Sector Advances
All but seven stocks rose among the 43 members of the Hang Seng Index. Futures on the measure climbed 1.6 percent to 20,918.
Esprit jumped 4.1 percent to HK$45.50. Cosco Pacific gained 4.3 percent to HK$10.42. Li & Fung Ltd., the biggest supplier to retailers including Wal-Mart Stores Inc., rose 1.1 percent to HK$36.20.
AT&T Inc., the biggest U.S. phone company, boosted its forecast for 2010 earnings, without giving specific numbers. United Parcel Service Inc., the world’s largest package-delivery company, also raised its annual profit forecast.
Microsoft, the world’s No. 1 software maker, reported a 48 percent increase in fourth-quarter net income, exceeding the average analyst estimate in a Bloomberg survey. The company also posted its biggest sales gain in 2 1/2 years.
About 80 percent of the companies on the Standard & Poor’s 500 Index that have reported results since July 12 beat analysts’ per-share earnings forecasts, Bloomberg data show.
Shimao Profit Soars
New World climbed 3.7 percent to HK$14.16. Glorious Property Holdings Ltd., a mainland developer, rallied 9 percent to HK$2.66.
Shimao Property Holdings Ltd., controlled by Chinese billionaire Xu Rongmao, advanced 2.6 percent to HK$15.10. Shanghai-listed unit Shanghai Shimao gave the first-half earnings forecast in a statement to the city’s stock exchange, without giving a profit figure.
China National Building Material Co., a cement maker, surged 7.1 percent to HK$14.48. Minmetals Resources Ltd., a metals trader, rose 1.4 percent to HK$2.94.
China will push for consolidation in the automobile, steel, cement, machinery, aluminum and rare earth industries in the second half through mergers, acquisitions and company restructuring, the China Business News reported today, citing Li Yizhong, Minister of Industry and Information Technology.
Jiangxi Copper Co., China’s largest producer of the metal, rose 2.8 percent to HK$16.84. Aluminum Corp. of China Ltd., the nation’s biggest maker of the metal, gained 1.5 percent to HK$6.59.
The London Metal Exchange Index, a measure of six metals including copper and aluminum, rose 2.3 percent.
Pearl Oriental Innovation Ltd., whose main business is logistics services and warehouse operations, jumped 11 percent to HK$1.16, after soaring as much as 20 percent. The company said it signed a strategic cooperation agreement with a unit of China Petrochemical Corp. for possible cooperation in exploration and exploitation of oil and gas fields.
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