Market Open:Hong Kong stocks seen higher on hot money
Hong Kong stocks are expected to rise on Wednesday on speculation that hot money is continuing to flow into the city, prompting pre-emptive measures by the city's de facto central bank, which sold Hong Kong dollars to weaken the local unit against the US dollar.
The Hong Kong Monetary Authority said on Tuesday it sold HK$3.88 billion after market closed, as the greenback was trading at HK$7.75 against the Hong Kong dollar, near the upper limits of an informal trading bad allowed under the arrangement under which the Hong Kong dollar is pegged to the US dollar. The local currency is pegged at HK$7.80 to the US dollar, but is allowed to trade between HK$7.75 and HK$7.85.
Overnight, the Standard & Poor's 500-stock index closed down 2.41 points, or 0.17 per cent, at 1,407.05. The Nasdaq Composite lost 5.51 points, or 0.18 per cent, to end at 2,996.69. In London, the FTSE-100 Index lost 2.20 points, or 0.04 per cent, to end at 5,869.04.
Hot Stocks of the Day:
Lai Fung Holdings Ltd (1125.HK)
The property developer is seeking a HK$3.55bn (US$458m) three-year syndicated loan, Reuters IFR reported onTuesday, citing unnamed sources.
The property developer said its January-November accumulated sales has amounted to 84.63 billion yuan, already 5.8 per cent higher than its 2012 sales target.
MEDIA CHINA CORPORATION (0419.HK)
The company said its chairman has boosted its holdings in the company to 25.97 per cent from 17.58 per cent. He bought the shares at HK$0.39 each.
Bank of East Asia (0023.HK)
The leading local lender said it has agreed to issue new shares to Japan's Sumitomo Mitsui Banking. Sumitomo Mitsui agreed to buy 111.57 million new shares at HK$29.59 per share for about HK$3.3 billion. BEA closed at HK$29.70 yesterday.