Hong Kong’s Stock Index Rises to 1-Week High; Li & Fung Climbs

Dec. 14 (Bloomberg) -- Hong Kong’s benchmark stock index rose to the highest level in more than a week as exporters gained ahead of a report expected to show U.S. retail sales climbed in the world’s biggest economy.

Li & Fung Ltd., the No. 1 supplier to Wal-Mart Stores Inc., advanced 1.6 percent. Techtronic Industries Co., the maker of Hoover vacuum cleaners and Ryobi power tools, increased 5.7 percent. China Shenhua Energy Co., the nation’s No. 1 coal producer, climbed 3.8 percent on expectations of higher coal demand.

The Hang Seng Index rose 0.5 percent to 23,431.19, its highest close since Dec. 2. Gains were limited ahead of a meeting of the U.S. Federal Reserve today at which policy makers will discuss increasing their bond purchase program.

Exporters benefit from “the economic recovery story, though it won’t be a smooth one,” said Steven Leung, director of institutional sales at UOB-Kay Hian Ltd. in Hong Kong. “The market is generally quiet and investors in Hong Kong are cautious. There isn’t much interest to get into the market at this point.”

The Hang Seng China Enterprises Index of so-called H shares of Chinese companies climbed 0.9 percent to 12,865.05.

The Hang Seng Index has climbed 7.1 percent this year on expectations that growth in corporate earnings will overcome concerns about the pace of the U.S. economic recovery and China’s steps to curb rising property prices. Shares in the gauge trade at an average 14.7 times estimated earnings, compared with about 17.2 times at the start of the year.

Retail Sales

Li & Fung gained 1.6 percent to HK$45.40. Techtronic climbed 5.7 percent to HK$10.46.

U.S. retail sales probably climbed in November for a fifth consecutive month, economists said ahead of a Commerce Department report later today. The median estimate of 62 economists surveyed by Bloomberg is for a 0.6 percent gain following a 1.2 percent increase in October.

Shenhua Energy climbed 3.8 percent to HK$31.75. China Coal Energy Co., a unit of the country’s second-biggest producer of the fuel, rose 2.9 percent to HK$11.98.

China will need 2 billion tons of standard coal over the next 10 years to fuel the country’s industrial development, the China Securities Journal reported, citing Dai Yande, deputy head of China’s Energy Research Institute.

Aluminum Corp. of China Ltd., the nation’s largest maker of the lightweight metal, climbed 1.3 percent to HK$7.20. Cnooc Ltd., China’s largest offshore oil producer, rose 0.8 percent to HK$18.48. PetroChina Co., the nation’s biggest oil company, gained 0.6 percent to HK$10.

Metals, Oil Gain

The London Metal Exchange Index of prices for six industrial metals including copper and aluminum gained 2.2 percent yesterday.

Crude oil futures rose 0.9 percent to $88.61 a barrel yesterday. The contract gained 0.3 percent today in electronic trading in New York as of 4:15 p.m. Hong Kong time.

Hybrid Kinetic Group Ltd., a manufacturer of hybrid vehicles, soared 11 percent to 20.6 Hong Kong cents. The company is studying the feasibility of setting up a plant in China that will make powertrains for hybrid vehicles.

Sa Sa International Holdings Ltd., Hong Kong’s biggest cosmetics retailer, rallied 11 percent to HK$5.35, after reaching a record HK$5.98. The company said it isn’t aware of any reason for the share-price movement.

MIE Holdings Corp. was unchanged on its debut, after rising as much as 4.1 percent and falling as much as 3.5 percent. The Chinese operator of oilfields sold 662 million shares at HK$1.70 each, raising net proceeds of HK$596 million ($76.6 million), according to a statement.

Two stocks gained for each that fell on the 45-member Hang Seng Index. Futures on the gauge advanced 0.3 percent to 23,390.

To contact the reporter on this story: Hanny Wan in Hong Kong at hwan3@bloomberg.net.

To contact the editor responsible for this story: Nick Gentle at ngentle2@bloomberg.net.