Hong Kong Stocks Rise Most in Week; Developers, AIA GainKana Nishizawa and Eleni Himaras
Hong Kong stocks rose, with the benchmark index climbing the most in a week, as developers rebounded from yesterday’s losses and as AIA Group Ltd. jumped after beating earnings expectations.
New World Development Co., the Hong Kong property company controlled by billionaire Cheng Yu-tung, gained 3.8 percent after profit rose. AIA, the third-largest Asia-based insurer by market value, rose 4.1 percent. Techtronic Industries Co., a power-tool maker that counts the U.S. as its biggest market, rose 5.8 percent after U.S. consumer sentiment surged and earnings at Home Depot Inc., its biggest customer, beat estimates.
The Hang Seng Index climbed 0.3 percent 22,577.01 at the close, its steepest gain since Feb. 20. The Hang Seng China Enterprises Index of mainland companies rose 0.4 percent to 11,144.3.
“The Hong Kong market is having a rebound,” said Ben Kwong, chief operating officer at brokerage KGI Asia Ltd. in Hong Kong. “Developers fared better today mainly because of upbeat results from individual companies.”
The city’s benchmark index yesterday erased this year’s gain as developers slid on concern China may introduce more measures to curb property prices. The gauge traded at 11 times average estimated earnings yesterday, compared with 13.5 for the Standard & Poor’s 500 Index and 12.2 for the Stoxx Europe 600 Index, according to data compiled by Bloomberg.
Hong Kong’s economic growth accelerated last quarter to the fastest pace in a year, expanding 2.5 percent in the three months through December from a year earlier, the Census & Statistics Department said on its website today.
U.S. Economic Data
Futures on the S&P 500 rose 0.1 percent today. The U.S. equity gauge advanced 0.6 percent yesterday as data showed purchases of new homes surged in January to the highest level since July 2008. Confidence among consumers jumped more than forecast in February.
Stocks tied to the U.S. advanced. Techtronic climbed 5.8 percent to HK$15.66 after Home Depot fourth-quarter profit rose on higher home-improvement spending and Hurricane Sandy repairs. Man Wah Holdings Ltd., a sofa maker that gets about half its sales from the U.S., climbed 1.1 percent to HK$7.18.
Property companies had the steepest gain among the Hang Seng Index’s four industry groups. The group dropped yesterday after Shanghai Securities News reported Beijing drafted new property control measures.
New World Development gained 3.8 percent to HK$13.76 after underlying profit jumped 45 percent. Shimao Property Holdings Ltd., the Chinese developer controlled by billionaire Hui Wing Mau, rose 1.9 percent to HK$15.22.
AIA advanced 4.1 percent to HK$32.85, the biggest contributor to the Hang Seng Index’s advance, after reporting 89 percent growth in net income last year, citing investment gains and product improvements. Profit rose to $3 billion in the 12 months to Nov. 30, beating the $2.7 billion average estimate of 12 analysts surveyed by Bloomberg.
Guangzhou Automobile Group Co. increased 6 percent to HK$6.56 after UBS raised its rating to neutral from sell as sales at its Japanese partners Toyota Motor Corp. and Honda Motor Co. stabilize.
Hang Seng Index futures were little changed at 22,566. The HSI Volatility Index slid 5.3 percent to 17.15, indicating traders expect a swing of 4.9 percent for the equity benchmark in the next 30 days.