Most Hong Kong Stocks Advance as Raw-Material Shares Gain

Jan. 22 (Bloomberg) -- Most Hong Kong stocks advanced after the International Monetary Fund raised its global growth forecast and as a gauge of Shanghai-listed shares surged. Raw-material producers led gains.

Angang Steel Co. jumped 5.2 percent after saying it expects to swing to a full-year profit from a loss a year earlier. China Overseas Land and Investment Ltd. added 2.6 percent as the China Securities Journal reported the nation may need at least two years to pass a property tax law. Casino operator Galaxy Entertainment Group Ltd. dropped 5.5 percent as JPMorgan Chase & Co. said investors should trim Macau gaming companies before their earnings statements.

The Hang Seng Index climbed 0.2 percent to 23,082.25 at the close in Hong Kong after falling as much as 0.5 percent. About twice as many stocks rose as declined on the 50-member gauge, with volume 22 percent more than the 30-day average for the time of day. The Hang Seng China Enterprises Index of mainland companies increased 1.1 percent to 10,326.73. China’s Shanghai Composite Index jumped 2.2 percent to 2,051.75.

“Chinese A-shares are continuing their rebound, and that’s helping sentiment a lot for Hong Kong,” said Jackson Wong, vice president of Tanrich Securities in Hong Kong. “But some sectors such as Macau gaming are countering gains and selling off because of their valuations. There is some rotational buying.”

Borrowing Costs

Shares traded on the mainland climbed after China’s money-market rates fell for a second day. The seven-day repurchase rate, a gauge of interbank funding availability, dropped 19 basis points to 5.25 percent in Shanghai, according to a daily fixing compiled by the National Interbank Funding Center. It fell 88 basis points yesterday, after a Jan. 20 jump of 153 basis points.

China’s economy will expand 7.5 percent this year, faster than the 7.3 percent seen in October, the IMF said in revisions to its World Economic Outlook released in Washington yesterday. The global economy will grow 3.7 percent, compared with an October estimate of 3.6 percent, according to the report.

Futures on the Standard & Poor’s 500 Index added 0.1 percent today after the gauge gained 0.3 percent yesterday.

The Hang Seng Index fell 1 percent this year, the worst performer behind Japan’s Nikkei 225 Stock Average and Singapore’s Straits Times Index among major developed-market gauges tracked by Bloomberg. The H-share index declined 4.5 percent in 2014 as data on China’s factory output and services industries fueled concern growth is slowing.

Chinese Factories

China’s manufacturing slowed to 50.3 in January from 50.5 the previous month, HSBC Holdings Plc and Markit Economics may say in a preliminary report tomorrow, according to the average of economist estimates compiled by Bloomberg.

Angang Steel rose 5.2 percent to HK$5.29 in Hong Kong. The company said it expects net income of 770 million yuan ($127 million) in 2013, compared with a net loss in 2012. Jiangxi Copper Co., China’s biggest producer of the metal, climbed 2.9 percent to HK$14.24.

China Overseas Land gained 2.6 percent to HK$22.05. Shimao Property Holdings Ltd., a mainland developer controlled by billionaire Hui Wing Mau, added 5.8 percent to HK$18.50, the biggest increase since July 11. China may need at least two years to pass a property tax law after a draft is submitted to the State Council in as early as 2014, the China Securities Journal reported.

Galaxy Entertainment led declines on the Hang Seng Index as it slumped 5.5 percent to HK$76.95, the most in seven months. JPMorgan said the industry’s revenue growth will slow to 17 percent this year.

Sands China Ltd. retreated 4.1 percent to HK$61.85, while MGM China Holdings Ltd., the operator controlled by MGM Resorts International, slid 6.6 percent to HK$32.65, the most since June 11.

To contact the reporters on this story: Kana Nishizawa in Hong Kong at knishizawa5@bloomberg.net; Jasmine Ng in Singapore at jng299@bloomberg.net

To contact the editor responsible for this story: Sarah McDonald at smcdonald23@bloomberg.net