Qihoo Rises as Wen Stimulus Comment Buoys ADRs: China Overnight

Qihoo Rises as Wen Stimulus Comment Buoys ADRs: China Overnight
Beijing-based Qihoo 360 Technology Co Ltd.,which last month started a search engine, is considering commercializing the service by introducing Google’s ads system, CEO Zhou Hongyi said yesterday,according to a report by Sina Corp.’s technology news service. Photographer: Keith Bedford/Bloomberg

Chinese stocks traded in New York rose, lifting the benchmark index to a two-week high, after Premier Wen Jiabao signaled the government has more room for fiscal and monetary stimulus measures to boost growth.

The Bloomberg China-US Equity Index of the most-traded Chinese companies in New York rallied 1.7 percent to 89.42 yesterday, the highest since Aug. 28. Qihoo 360 Technology Co Ltd. jumped the most in three weeks after its chief executive officer said the software developer’s new search engine may use Google Inc.’s advertising system. Cnooc Ltd. gained the most since July as the oil explorer plans to issue bonds to fund its bid for Canada’s Nexen Inc. Suntech Power Holdings Co. led gains on the index.

China still has “ample strength” in either monetary or fiscal domains to propel economic growth, Wen said yesterday at the World Economic Forum in the Chinese city of Tianjin, adding the government has 100 billion yuan ($16 billion) in a fiscal stabilization fund. Chinese banks’ 703.9 billion yuan new lending in August exceeded the 600 billion yuan median estimate of 32 economists in a Bloomberg News survey.

“China has a tremendous scope to stimulate, and it’s nice to see the premier reinforce that,” Alec Young, a global equity strategist at S&P Capital IQ, said in a telephone interview from New York. “The better loan numbers and Wen’s comments buy the Chinese some time, but the market wants to see more aggressive action from the government before it can feel real comfortable about Chinese equities.”

China ETF Gains

The iShares FTSE China 25 Index Fund, the biggest Chinese exchange-traded fund in the U.S., climbed 1 percent to $33.40. The Standard & Poor’s 500 Index of the biggest U.S. shares added 0.3 percent to 1,433.56 amid speculation the Federal Reserve will act to stimulate the economy and after Germany’s highest court said it won’t delay its ruling on the euro area’s permanent bailout fund.

China’s top planning agency last week approved the construction of new roads, railways and urban infrastructure, while the People’s Bank of China cut benchmark interest rates in June and July.

“China has been actively easing in none-traditional ways, and with smaller adjustments which are certainly positive,” Dave Lutz, head of exchange-traded fund trading at Stifel Nicolaus & Co., said yesterday from Baltimore. “Going forward, as we have resolution in the euro zone, we’ll see the market acting a lot better because a stronger euro makes Chinese exported goods less expensive to Europeans.”

Qihoo’s American depositary receipts advanced 4.7 percent to $24.43, the highest level since Aug. 22.

Google Ads

Beijing-based Qihoo, which last month started a search engine, is considering commercializing the service by introducing Google’s ads system, CEO Zhou Hongyi said yesterday according to a report by Sina Corp.’s technology news service. He also said Qihoo’s search engine plans to start an open platform “soon” to cooperate with other smaller, high-quality search tools for better results.

ADRs of Cnooc, China’s biggest offshore oil explorer, jumped 4.1 percent to $190.83, the biggest rally since July 17. The ADRs, each representing 100 underlying shares in Cnooc, traded 0.7 percent above its Hong Kong stock, from a 0.8 percent discount the previous day.

Cnooc agreed in July to pay $15.1 billion in cash to acquire Calgary-based Nexen. As the deal is under review by the Canadian government, Cnooc is in talks with offshore banks for about $5 billion in short-term loans for fund the purchase, and is considering eventually replacing that loan with a bond, two people familiar with the matter said.

Solars Gain

Suntech, the world’s largest solar-panel maker, rose 8.4 percent to 80.5 cents in New York trading. Trina Solar Ltd., the fourth-largest, increased for a second day, up 3.2 percent to $4.23. LDK Solar Co. gained 3.3 percent to $1.27 while Yingli Green Energy Holding Co. added 5.2 percent to $1.82.

Trina, the Changzhou, China-based company that reported a fourth quarterly loss last month, is seeking partners to diversify as a global glut of panels and slowing demand in Europe spur a shakeup of the industry, CEO Jifan Gao said yesterday in an interview in Tianjin.

“We’re actively looking for targets. Companies like Siemens may be a rival, but I also see them as partners for cooperation,” he said.

Before it's here, it's on the Bloomberg Terminal. LEARN MORE