SouFun Drives Property Jump Before Data: China Overnight

Chinese equities rose to the highest level in six months in New York, led by real estate website SouFun Holdings Ltd., on prospects economic data will signal a recovery in the world’s second-largest economy.

The Bloomberg China-US Equity Index of the most-traded Chinese stocks in the U.S. advanced 0.7 percent to 105.3 yesterday, the highest since March. SouFun, China’s biggest real estate information site, jumped to the highest since its 2010 debut, and Xinyuan Real Estate Co. climbed to a four-year high. E-House China Holdings Ltd. gained the most in four weeks, while Pactera Technology International Ltd. soared to a seven-month high after agreeing to a buyout led by Blackstone Group LP.

China may report today that economic expansion rebounded to

7.8 percent for the last three months, according to the median forecast of 48 economists compiled by Bloomberg, after the pace slowed in the two previous quarters. Property transaction volumes rose 17 percent in the first week of October in 32 major cities monitored by SouFun, it said in a statement Oct. 9. The Chinese Communist Party will meet next month to discuss deepening reforms, Xinhua News Agency said in August.

“The consensus is that growth in the third quarter should be higher than the second quarter, basically reflecting the rebound over the summer of the Chinese economy, and should ease concern about lending in China,” Wang Qinwei, an economist at Capital Economics Ltd. in London, said by phone yesterday. “In the coming plenary session of the party congress meeting, maybe we can see some kind of reform measures regarding rural land.”

ETF Slips

The iShares China Large-Cap ETF, the largest Chinese exchange-traded fund in the U.S., slipped 0.2 percent to $38.11 in New York, falling a second time this week. The Chicago Board Options Exchange China ETF Volatility Index, measuring predictions of price fluctuations in the ETF, declined to the lowest since May. The Standard & Poor’s 500 Index added 0.7 percent after President Barack Obama signed a bill to fund the government through Jan. 15 and extend the borrowing authority through Feb. 7.

Non-financial foreign direct investment in China rose 4.9 percent in September from a year earlier to $8.8 billion, the Ministry of Commerce said yesterday, compared with a 0.6 percent gain in the prior month.

SouFun’s American depositary receipts jumped to $56.50, the highest level since its U.S. listing in September 2010. Trading volume was 2.8 times the 90-day average compiled by Bloomberg.

Beijing-based Xinyuan, a developer, surged 5.4 percent to $7.22, the highest level since June 2009. E-House, a Shanghai-based property brokerage, added 3.7 percent to $9.42.

Mobile Devices

Baidu Inc., China’s biggest online search engine, gained for the first time this week, rising 2.4 percent to $153.83. Citigroup Inc. lifted a price target on Baidu stock to $175 from $167 and maintained a buy recommendation, citing revenue growth from its services on mobile devices.

NQ Mobile Inc., a mobile-security service provider, soared 13 percent to a record high of $24.44, gaining the most in two months. The Beijing-based company was rated the equivalent of buy in initial coverage at Macquarie Group Ltd. yesterday.

NQ plans to hold a special product-related conference call prior to market opening on Oct. 22 to announce a new product, it said in a statement yesterday.

Pactera, which provides technology outsourcing services, surged 8.1 percent to $7.07 in New York, the highest price in seven months.

The Dalian, China-based company said it agreed to be acquired by a Blackstone-led buyout group for $7.3 per ADR, a 39 percent premium over the price offered on May 17. Inc., a Chinese online marketplace, plans to offer 11 million ADRs for a price between $13 and $15, according to its filing yesterday.

The Hang Seng China Enterprises Index dropped 0.6 percent to 10,568.71 yesterday, while the Shanghai Composite Index slipped 0.2 percent to 2,188.54 in a third day of declines.