Index ends higher on the back of blue chips
HANG Seng Index stocks traded mixed in hollow sentiment yesterday as derivative-linked activity set direction.
The index closed up 72.50 points at 9,152.89, mainly on the movement of four stocks. Turnover was a modest $2.4 billion.
Trading opened near the Friday close of 9,080. Buyers took the index through 9,100 by 10.15am to reach 9,111.21.
Buying continued for the rest of the session, taking the index to 9,148.71 by lunchtime.
In the afternoon derivative-linked trading saw the index spike up to a high of 9,192.74. Profit-taking after 3 pm brought the index to its 9,152.89 close.
'There really was not a lot going on. Some people spoke of better sentiment on the easing in Sino-US relations but fundamentally there was little happening,' a broker said.
The focus of trading was on the main liquidity stocks in the index.
HSBC Holdings, making up 17.4 per cent on the index, rose $1.50 to $104.50, representing 22.86 points on the index. The turnover was the second largest of the day at $200.37 million.
Hongkong Telecom was up 10 cents to $13.95, representing 6.5 points on the index. The stock makes up almost 10 per cent of the index. Turnover in the stock yesterday was $101.34 million, the fifth highest of the day.
Cheung Kong rose 50 cents to $38.30, representing 6.4 points. The stock makes up 5.3 per cent on the index. It turned over $119.89 million, the fourth biggest of the day.
Hutchison Whampoa saw the biggest turnover stock of the day with $208 million. The stock was up 30 cents to $37.40, representing 6.3 points on the index.
In total, these four stocks made up 42.15 points on the index, representing almost 60 per cent of the rise on a day when the aggregate of constituent stocks falling represented about five points.
CITIC Pacific was the third most active stock of the day, in dollar value terms. It was up 35 cents to $21.60 on a turnover of $156 million.
While brokers suggested blue chips experienced a relatively quiet day, the opposite was true in H shares. A spate of mixed results announcements have affected the fortunes of the Hang Seng China Enterprises Index.
The index was off 35 points on the day at 918.37, its lowest level since the end of January. On January 30, the index was at 895.58.
On the year to date the index is off 14 per cent and on the 12-month period it is off 27.68 per cent.
Shanghai Haixing was the busiest stock of the day, in share volume, and it was the biggest faller of the day in price terms.
The share plummeted 26.7 per cent or 30 cents to 82 cents on a turnover of $64 million or 70.8 million shares. The close is the lowest since listing last year.
This big fall represented 15 points on the sector index and came on the back of lousy results. The firm reported a 73 per cent decline in profit at the interim stage to June 30 of 50.51 million yuan (about HK$47.02 million).
Maanshan Iron and Steel also was in pretty bad shape, falling seven cents or five per cent to $1.26 on a volume of 25 million shares, the second biggest of the day.
The firm reported a dive in net profit of 93 per cent in the first six months of the year. Profit after tax plummeted to 40 million yuan from 590.57 million yuan a year ago, the steel manufacturing company said.
Other H shares in sellers' sights included Luoyang Glass, down 30 cents to $3 on a turnover of $8.5 million. Tsingtao Brewery fell 20 cents to $2.55 on a turnover of $4.2 million.
The brewing firm reported a 49 per cent drop in profit to 51.5 million yuan. The group was hurt by big rises in costs.
Bucking the trend was Jilin Chemical. The share was up eight cents or four per cent to $1.93.
The chemical industrial saw net profit for the first six months rise 49.63 per cent on the strength of brisk sales and rising prices. Jilin, which listed in July, reported interim profit after tax was 486.2 million yuan.
Today could be a shocker for the Hang Seng China Enterprises Index as a fairly mixed bag of figures emerged in the evening from the results reported by key H-share companies.
Poor sentiment towards H shares is expected to have little or no impact on market sentiment towards the main Hang Seng Index constituents, many of which have been reporting interims ahead of expectations.
South China Morning Post came in ahead of expectations yesterday with an attributable profit rise of 2.8 per cent to $580 million. The share lifted 2.5 cents to $4.45.