Hong Kong stocks rose, led by developers, as Sino Land Co. reported better-than-expected earnings and after home sales in the city jumped to the highest in almost three years.
Sino Land, a Hong Kong developer controlled by billionaire Robert Ng, climbed 3.2 percent after reporting full-year profit that beat analyst estimates. Sun Hung Kai Properties Ltd., the world’s biggest developer, rose 0.5 percent. Ping An Insurance (Group) Co., China’s second-largest insurer, jumped 5.5 percent after terms of sale showed its share offering was priced at the high end of the range. Esprit Holdings Ltd. tumbled for a second day, falling 5.4 percent after brokerages cut their ratings on the global fashion retailer.
“The home sales data gave a positive outlook for Hong Kong developers,” said Michiya Tomita, a Hong Kong-based fund manager for Mitsubishi UFJ Asset Management Co., which holds $65 billion in assets. “Investors are now turning bullish on the outlook of the property sector.”
The Hang Seng Index rose 0.5 percent to close at 20,971.50, extending its gains this week to 1.8 percent. That’s the measure’s first weekly gain in four. Twenty-five stocks increased and 11 fell on the 43-member gauge. The Hang Seng China Enterprises Index of so-called H shares of Chinese companies advanced 0.7 percent to 11,767.41.
Hong Kong’s home sales rose 33 percent in August from July, the Land Registry said yesterday, as demand outweighed government efforts to curb home prices by tightening mortgage rules and pledging to increase land supply.
A measure of property developers had the second-biggest gain among the Hang Seng Index’s four industry groups. Sino Land led the measure higher, rising 3.2 percent to HK$14.02. The developer said full-year profit excluding revaluation gains fell 2.6 percent to HK$3.51 billion ($452 million), better than the median estimate of HK$3.37 billion of 15 analysts surveyed by Bloomberg.
Sun Hung Kai Properties advanced 0.5 percent to HK$111.70. Henderson Land Development Co., the Hong Kong builder controlled by billionaire Lee Shau-kee, increased 1.1 percent to HK$47.65.
The Hang Seng Index has fallen 6.5 percent from its highest close this year on Jan. 6 as China’s efforts to cool its property market and Europe’s debt crisis fueled concern the global economic recovery may stall. Stocks on the gauge trade at an average 13.5 times estimated earnings, Bloomberg data show, down from 17.2 times at the beginning of the year.
Ping An jumped 5.5 percent to HK$69.70, the biggest gain on the Hang Seng Index, after its share offering was priced at HK$65.30 each, the high end of the range of HK$64.68 to HK$65.30, according to terms of the sale obtained by Bloomberg News.
Citic 1616 Holdings Ltd., a company that connects international phone calls and is controlled by Citic Pacific Ltd., surged 26 percent to HK$2.51 after saying it will acquire a 49 percent stake in an Internet company from Citic Group and CE-SCM Network Technology Co. Ltd.
Among stocks that fell, Esprit declined 5.4 percent to HK$40.60, the biggest drag on the Hang Seng Index. JPMorgan Chase & Co. and CIMB-GK Securities HK Ltd. both cut their rating on the stock. The retailer yesterday tumbled as much as 5.2 percent after reporting worse-than-expected full-year profit.
Xingda International Holdings Ltd. fell 3.4 percent to HK$5.75 after the maker of steel cord used in tires said it will raise HK$762.3 million through the issue of 138.6 million new shares at HK$5.50 each.
Futures on the Hang Seng Index rose 0.8 percent to 20,989.