July 16 (Bloomberg) -- Hong Kong stocks rose, with the benchmark index advancing for a second day, after Premier Wen Jiabao said China’s government will boost measures to support growth in the world’s second-biggest economy.
Belle International Holdings Ltd., China’s No. 1 retailer of women’s shoes, rose 1.9 percent. Sands China Ltd. climbed 2.4 percent after the gaming company said it was given more time to build a casino resort in Macau on land granted by the government. ZTE Corp., the second-largest maker of telecommunications equipment in China, slumped 16 percent after saying first-half profit probably dropped by as much as 80 percent from a year earlier.
“There should be some more stimulus,” said Castor Pang, Pang, head of research at Core-Pacific Yamaichi International Ltd. in Hong Kong. “China’s measures aren’t enough to bring the economy back to a normal level. That’s why investors are uncertain about earnings.”
The Hang Seng Index added 0.2 percent to 19,121.34 at the close in Hong Kong, erasing losses of as much 0.2 percent. Almost three shares fell for every two that rose on the gauge. The measure sank 3.6 percent last week amid concern slowing growth in China and the U.S. will hurt corporate profits.
The Hang Seng China Enterprises Index of Chinese companies listed in the city dropped 0.2 percent to 9,218.78, erasing gains of as much as 0.8 percent. Trading volumes were 29 percent below the 30-day average, according to data compiled by Bloomberg.
Retailers gained after Premier Wen said the government will step up policy fine-tuning in the second half. “It should be clearly understood that the momentum for a stable rebound in the economy has not yet been established,” the official Xinhua News Agency cited Wen as saying.
Belle rose 1.9 percent to HK$13.88. Chow Tai Fook Jewellery Group Ltd., the world’s biggest listed jewelry retailer, gained 1.3 percent to HK$9.33.
China’s State Council may this week give details of easing measures to support growth after provincial visits by Wen and Vice Premier Li Keqiang to check on the economy, Nomura Holdings Inc. said in a note today. The China Securities Journal reported that a meeting as early as July 18 may be followed by policy steps, citing unidentified analysts.
Sands China climbed 2.4 percent to HK$23.30. The deadline to develop a plot called Parcel 3 in Macau was extended to April 17, 2016, from April 2013, the company said in statement today.
Sinopec Yizheng, ZTE
The benchmark Hang Seng Index fell 12 percent from this year’s high in February on signs Europe’s debt crisis is worsening while growth slows in China and the U.S. The drop dragged down the value of shares on the gauge to 10 times estimated earnings on average, compared with 13.1 for the Standard & Poor’s 500 Index and 10.7 for Stoxx Europe 600 Index.
Slowing economic growth is starting to hurt company earnings, with companies from China Southern Airlines Co. and Sinopec Yizheng Chemical Fibre Co. predicting weaker first-half profits since last week.
Sinopec Yizheng Chemical Fibre sank 4.7 percent HK$1.62 after the supplier of polyester chips predicted first half losses. Leoch International Technology Ltd. slumped 20 percent to HK$1.07 after the maker of batteries said first-half profit will drop substantially.
ZTE tumbled 16 percent to HK$10.46, the lowest close since March 2009. The company said net income is estimated to have declined to between 154 million yuan ($24 million) and 308 million yuan in the six months ended June 30, from 769.3 million yuan a year earlier.
Sun Hung Kai Properties Ltd., Hong Kong’s biggest developer, slid 1 percent to HK$94.50 after its billionaire co-chairmen Thomas and Raymond Kwok were charged with bribery last week.
The Kwoks and two other men conspired to provide Rafael Hui, the city’s former No. 2 official, with payments and loans totaling HK$34 million ($4.4 million) for unspecified favors involving Hui’s role as the government’s then chief secretary, the Independent Commission Against Corruption said in a July 13 statement.
Futures on the Hang Seng Index added 0.3 percent to 19,088. The HSI Volatility Index lost 0.2 percent to 19.46, indicating traders expect a swing of about 5.6 percent in the benchmark index during the next 30 days.
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