E-House Leads Biggest Gain Since January: China Overnight

Chinese stocks traded in New York posted the biggest weekly gain in eight months, led by real estate companies and solar makers, amid signs the economy is strengthening after two quarters of slowing growth.

The Bloomberg China-US Equity Index of the most-traded Chinese stocks in the U.S. added 4.7 percent to 99.53, the most since the week ended Jan. 4. The gauge, which entered a bull market Sept. 4, has risen 22 percent from its June low. Real-estate brokerage E-House China Holdings Ltd. soared 43 percent, its biggest increase on record, while property website SouFun Holdings Ltd. surged 19 percent. Solar-panel maker Yingli Green Energy Holding Co. advanced 30 percent to a 19-month high.

China’s home prices rose in August by the most since December, data from SouFun showed last week. The official Purchasing Managers’ Index rose more than estimated to a 16-month high, the government said on Sept. 1. Margins improved for solar energy producers in the second quarter, a Bloomberg Industries report showed Sept. 5. Since June 24, the Bloomberg China-US gauge has outperformed the 3.9 percent gain in India’s S&P BSE Sensex and the 17 percent jump in Brazil’s Ibovespa.

“In the past, the government talked about curbing prices,” Michael Ding, lead manager of the China Region Fund at the U.S. Global Investors Inc., which oversees $2.2 billion, said by phone from San Antonio, Texas on Sept. 6. “The new leadership, since they took over, never really talked about curbing the real estate market. They’ve been more inclined to use the market mechanisms instead of using government control. That’s very positive.”

ETF Rallies

The iShares China Large-Cap ETF, the largest Chinese exchange-traded fund in the U.S., rallied 6.4 percent, the biggest weekly advance since December 2011. The Standard & Poor’s 500 Index added 1.4 percent for the week.

E-House’s American depositary receipts surged 11 percent to $8.69 on Sept. 6, the highest level since October 2011. Trading volume was more than six times daily average over the past three months, data compiled by Bloomberg showed.

SouFun, owner of China’s biggest real estate information website, ended at $49.53 on Sept. 6, completing its third week of gains.

Baoding, China-based Yingli advanced 1.5 percent to $5.59 on Sept. 6, the highest since Feb. 9. 2012. Trading volume on the ADR, the most active on the Bloomberg China-US gauge, was twice the three-month average.

Suntech added 2.7 percent to a two-week high of $1.15, after surging 12 percent on Sept. 5.

“The solar companies are basically supported by Chinese government policy,” said Ding. “The outlook for the U.S. market is also better than two years ago, and that provides more opportunities.”

Growing Fleet

China Southern Airlines Co., the biggest Asian carrier by traffic, surged 11 percent last week, the most since January, to $18.91, while China Eastern Airlines Corp., the nation’s third-biggest carrier by sales, jumped 6.5 percent to $16.09.

China will need 5,580 new planes costing $780 billion through 2032, Chicago-based Boeing said in a statement distributed at a briefing in Beijing. Boeing said last year that China would need 5,260 new planes worth $670 billion through 2031. The planemaker said that the size of China’s airplane fleet will triple over the next two decades as traffic in the country grows by almost 7 percent a year.

The Hang Seng China Enterprises Index was little changed at 10,334.07, ending the week with a 5.2 percent jump, while the Shanghai Composite Index climbed 0.8 percent to 2,139.99 for a 2 percent gain on the week.