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Hong Kong stocks eke out gains as energy shares shine, but Tencent tumbles after being fined for breaching cyber laws

Shanghai Composite also ends slightly higher, as coal miners advance

PUBLISHED : Tuesday, 26 September, 2017, 9:08am
UPDATED : Tuesday, 26 September, 2017, 6:05pm

Hong Kong stocks closed barely higher on Tuesday, with energy shares shining on the back of rising oil prices, while Tencent was the biggest contributor to losses after receiving a fine from the internet regulators for breaching China’s cyber laws.

The Hang Seng Index inched up 0.1 per cent, or 12.67 points, to close at 27,513.01. The Hang Seng China Enterprises Index, known as the H-share index, rose 0.5 per cent to 10,968.39.

Daily turnover fell 13 per cent to HK$97 billion (US$14.68 billion), compared with Monday.

Leading the way were China’s three state-owned energy giants – Cnooc, PetroChina, and Sinopec – after Brent crude settled at a two-year high, and West Texas Intermediate closed above US$52 a barrel for the fist time in four months.

Property stocks are pausing here after significant gains in stock prices. The implementation of new curbs provides a good excuse for investors to take decent profits from the sector
Wu Kan, a fund manager at Shanshan Finance in Shanghai

Cnooc, the country’s largest offshore oil producer, jumped 4 per cent to HK$9.9. It was the biggest gainer among blue-chip stocks.

PetroChina climbed 3.5 per cent to HK$5. Refiner Sinopec advanced 1.7 per cent to HK$5.91.

Tencent Holdings, however, was the biggest negative contributor to the benchmark index. It fell 1.2 per cent to close at HK$337.6, responsible for 35 points of losses on the Hang Seng.

The Guangdong office of China’s internet watchdog said on Monday it had imposed “maximum fines” on Tencent under the new cybersecurity law, citing its failure to deal with pornography, violence, and other banned content on its popular social app WeChat.

Meantime, the watchdog’s Beijing office also fined Sina and Baidu, operators of microblogging service Sina Weibo and online forum Baidu Tieba, for similar reasons.

Property shares were also weak, after Chongqing and provincial capital cities including Shijiazhuang and Changsha imposed bans on new home re-sales between two and five years of purchase, in at attempt to rein in property prices last week.

China Evergrande fell 3.2 per cent to HK$26.05, extending an 8.8 per cent slump on Monday. Sunac China lost 1.1 per cent to HK$31.65 after sliding 7 per cent a day earlier.

Chinese developers have seen a sector-wide 50 per cent advance on the Hang Seng Index since February last year, with shares in China Evergrande Group and Sunac China surging at least fivefold in the period, due to rising home prices.

“Property stocks are pausing here after significant gains in stock prices,” said Wu Kan, a fund manager at Shanshan Finance in Shanghai. “The implementation of new curbs provides a good excuse for investors to take decent profits from the sector.”

On the mainland, the Shanghai Composite Index closed at 3,343.58, up 0.1 per cent, or 2.03 points. The CSI 300 Index of large company shares also added 0.1 per cent to 3,820.78.

The Shenzhen Composite Index ended flat at 1,964.03, while the ChiNext Price Index rose 0.2 per cent to 1,839.46.

Energy producers were the best performers among sectors. Yanzhou Coal Mining rose 2.6 per cent to 13.08 yuan. Offshore Oil Engineering gained 1.5 per cent to HK$6.23.

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