Hong Kong Stocks Swing on China Industrial Data, CasinosJonathan Burgos
Hong Kong stocks fluctuated as growth in China’s industrial profits slowed and investors weighed the outlook for U.S. interest rates. Casinos advanced.
Standard Chartered Plc dropped 3.5 percent after the U.K. bank that generates three quarters of its earnings from Asia said first-half profit probably fell 20 percent. SA SA International Holdings Ltd. slipped 1.1 percent after Citigroup Inc. cuts its rating on the cosmetics retailer. Wynn Macau Ltd. and Melco Crown Entertainment Ltd. rose at least 1 percent, pacing gains among casino operators.
The Hang Seng Index was little changed at 23,199.99 as of 10:27 a.m. in Hong Kong, having swung between a decline of 0.1 percent and an increase of 0.3 percent. The gauge, which advanced by most in six weeks yesterday, is poised to gain less than 0.1 percent this week. The Hang Seng China Enterprises Index of mainland companies, also known as the H-share index, slipped 0.2 percent to 10,316.95.
“The Hong Kong market is losing steam after yesterday’s rally given the lack of catalysts,” Linus Yip, a strategist at First Shanghai Securities Ltd. in Hong Kong, said by phone. “We may see further consolidation.”
China’s industrial profits grew 8.9 percent last month from a year earlier, slowing from a 9.6 percent pace in April. The Hang Seng Index lost 0.5 percent this year through yesterday amid speculation China will miss its economic growth target. The measure was valued at 10.8 times estimated earnings at the last close, compared with 16.6 for the Standard & Poor’s 500 Index.
Futures on the S&P 500 were little changed today. The U.S. equity gauge slipped 0.1 percent yesterday after James Bullard, president of the Federal Reserve Bank of St. Louis, said the economy could weather an increase in short-term borrowing costs next year as growth picks up. Bullard favors raising interest rates in the first quarter. Fed policy makers said this month they near-zero rates for a “considerable time.”
A report yesterday showed U.S. consumer spending rose less than forecast in May. Purchases, which account for about 70 percent of the economy, climbed 0.2 percent last month after being little changed in April, the Commerce Department reported. The median forecast in a Bloomberg survey of economists called for a 0.4 percent increase.