Hong Kong stocks erased earlier
losses to close up 0.26 percent on Monday, as investors hunted
for bargains after shares fell to three-week lows, but concerns
about the state of the U.S. economy capped gains.
A narrowing in losses of index heavyweight HSBC (0005.HK)
also helped the key index to rebound from earlier losses.
HSBC closed down 0.98 percent, after falling by as much as
1.6 percent earlier in the day. Chief Executive Michael Geoghegan
expressed caution about growing too fast because he feared a
second economic downturn could force the bank to make write-downs.
The market has been down in the previous sessions, so there
was some bargain hunting, said Howard Gorges, a director at
South China Brokerage. A slight recovery in HSBC helped a bit.
The benchmark Hang Seng Index .HSI, which swung back to a
gain, finished up 53.58 points at 20,429.07. The index was down
0.2 percent at midday.
Hong Kong shares have fallen in six out of the last seven sessions
to a three-week low on Friday.
Volume fell to HK$43.7 billion ($5.6 billion), the lowest since Sept. 15
and down from Friday's HK$56.9 billion. A public holiday in China
damped demand for Hong Kong stocks. China's equities markets will
resume trading on Oct. 9.
Consumer goods exporter Li & Fung (0494.HK) lost 4.7 percent
on concern that a rising jobless rate would further cut consumer
spending in the U.S., one of Asia's top markets overseas.
U.S. employers unexpectedly shed more jobs in September than
in August, highlighting the fragility of the economy's recovery
from its worst recession in 70 years.
U.S. consumer spending has been the engine of growth for the
global economy. Now that engine has stalled as the unemployment
situation worsens, said Francis Lun, general manager at
The China Enterprises Index .HSCE of top locally listed
mainland Chinese stocks was up 1.03 percent at 11,645.05, led by
a 4.11 percent gain in Anhui Conch (0914.HK).
Chinese cement maker Anhui Conch rose on speculation that
rival China Resources Cement (1313.HK) would do well on its
trading debut in Hong Kong on Tuesday. That prompted investors to
buy shares of firms from the same industry, traders said.
China Resources Cement saw the retail portion of its HK$6.39
billion IPO oversubscribed by 81.6 percent, the Sing Tao Daily
reported on Monday.
Toys-to-property company RBI Holdings (0566.HK) extended
gains, up 8.2 percent. The stock more than tripled on Friday
after it said it would acquire Apollo Precision, a maker of
silicon-based thin film photovoltaic modules, for HK$4.18 billion
($539.4 million), to cash in on growing demand for solar energy
R&F Properties (2777.HK) gained 1.04 percent. The Chinese
developer received formal approval from China's Securities
regulator to issue up to 5.5 billion yuan ($805 million) worth of
local currency bonds, the Hong Kong Economic Times said.