Internet Stocks Lead Gain on Manufacturing Data: China Overnight
Chinese equities rose for a fourth week in New York, the longest stretch of advances since October, on expectations a report due tomorrow will show manufacturing expanded for a third month.
The Bloomberg China-US Equity Index of the most-traded Chinese shares in New York climbed 0.4 percent last week. Sina Corp. (SINA), owner of China’s Twitter-like Weibo service, completed a three-week rally and Sohu.com Inc. (SOHU) jumped to a seven-month high after policy makers said they plan to introduce measures to boost the Internet information industry. Suntech Power Holdings Co. posted a five-day surge of 24 percent, as the government plans to increase demand for solar energy.
China’s December Purchasing Managers’ Index, scheduled to be released tomorrow, will probably show a climb to 51 from 50.6 in November, according to the median estimate of 25 economists surveyed by Bloomberg. The Chinese Communist Party’s new leadership, appointed last month, pledged to boost urbanization and consumer demand as the nation plans to increase its budget deficit to fund local governments and spur a recovery in the world’s second-largest economy.
“Sentiment toward Chinese stocks is improving as we are seeing some fiscal stimulus,” Tony Hann, who oversees $400 million of assets as head of emerging-market equities at Blackfriars Asset Management Ltd., said by phone from London on Dec. 28. “I’ve no doubt that if the PMI does better than expected, it would add favor to the market. Equities should perform well in the first quarter.”
A separate PMI index by HSBC Holdings Plc is due today.
The China-US Index has climbed 7.5 percent this year. The iShares FTSE China 25 Index Fund, the largest Chinese exchange-traded fund in the U.S., advanced 0.8 percent last week to $39.55 and is set for a 13 percent increase for the year. The Standard & Poor’s 500 Index retreated 1.9 percent last week to 1,402.43.
The Shanghai Composite Index (SHCOMP) of domestic shares rallied 3.7 percent in its fourth weekly gain to 2,233.25, rising 1.5 percent this year. The Hang Seng China Enterprises Index (HSCEI) advanced 1.3 percent during the week to 11,378.24, up 15 percent for the year.
Sina, based in Shanghai, added 2.2 percent to $48.35 on Dec. 28, extending its gains to a third week, the longest rising period since February. Sohu.com, which operates China’s fifth-most visited website and is based in Beijing, climbed 4.5 percent last week to $46.47, the highest price since May 9.
China’s Ministry of Industry and Information Technology will introduce policies next year to develop mobile Internet, mobile television, smart TV and online shopping and payment, the Shanghai Securities News reported on Dec. 27, citing minister Miao Wei.
Suntech, the biggest solar-panel maker in the world based in Jiangsu, China, surged to a five-month high of $1.40. The company was the biggest weekly gainer on the Bloomberg China-US gauge.
LDK Solar Co., the world’s second-largest maker of solar wafers based in Xinyu of China’s Jiangxi province, soared 17 percent to $1.35 last week.
The Chinese government may start new measures to boost household electronics, vehicles and solar energy for rural use, China Securities Journal said in Dec. 27 report, citing unidentified analysts.
Bona Film Group Ltd. (BONA) ended the week up 11 percent in New York to $4.79, the biggest rally since September.
The Beijing-based film producer said in a statement Dec. 28 its shareholders approved Deloitte Touche Tohmatsu CPA Ltd. to be the auditor for its 2012 financial statements.
Ambow Education Holding Ltd. (AMBOY), a private education service provider based in Beijing, tumbled 12 percent last week to $2.52. The slump was the most among weekly decliners on the Bloomberg gauge.
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