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Hong Kong stocks rise for a fifth session, notching longest win streak since July

China Unicom shares plunge 1.9 pc in Hong Kong and 8.4 pc in Shanghai following reports the company is being sued in a Beijing court

PUBLISHED : Wednesday, 11 January, 2017, 9:14am
UPDATED : Wednesday, 11 January, 2017, 10:08pm

Hong Kong stocks scored their best finish in two months on Wednesday, with the Hang Seng Index advancing for a fifth straight day, reflecting its longest winning streak since July 18.

However, a sharp decline in China Unicom pulled Shanghai shares lower at close.

The Hang Seng Index rose 0.8 per cent or 190.50 points to end at 22,935.35, the highest close since November 1. It also logged a fifth straight trading day of gains, the index’s longest bull run since a six-session win streak that ended on July 18.

In the meantime, the Hang Seng China Enterprises Index, or H-shares index, added 0.7 per cent or 69.71 points to 9,733.90.

Daily turnover increased to HK$70 billion from Tuesday’s HK$62 billion.

“US Treasury yields and the US dollar have retreated from post-election highs, a week before Trump becomes the US president. This has led to a honeymoon period for Hong Kong stocks,” said Chiu Chun Ngan, a strategist for First Shanghai Securities.

However, investors will also be looking to a news conference by Donald Trump scheduled for later in the US day, analysts said.

This will be the first news conference by Trump since his election win, and it could offer more clues on his policies when he takes office on January 20.

“Uncertainty has surrounded Trump’s economic stimulus [plans]. Markets hope to find more details at tonight’s event,” said analysts from Industrial Securities in a note on Wednesday.

“The Trump rally has faded. If he lets down the market or implies a weak-dollar policy bias, the greenback could decline further, which will have an impact on global financial markets,” they added.

On the mainland, the Shanghai Composite Index dropped 0.8 per cent to close at 3,136.75. The CSI 300 — which tracks large companies listed in Shanghai and Shenzhen — also lost 0.7 per cent to 3,334.50.

The Shenzhen Component Index shed 0.9 per cent to 10,215.48 and the Shenzhen Composite Index shed 1.1 per cent to 1,968.43. The Nasdaq-style ChiNext settled 0.7 per cent lower at 1,937.55.

Combined turnover for the Shanghai and Shenzhen markets decreased to 405 billion yuan from 418 billion yuan on Tuesday.

Leading the losses were China Unicom, the country’s second-largest mobile carrier. State media reported a financial information service platform has filed a lawsuit in a Beijing court against China Unicom, alleging that the mobile carrier had placed an intrusive pop-up ad on the service provider’s mobile app, which led to forced heavy data usage for app users.

Shares of China Unicom plunged as much as 9.9 per cent on the Shanghai Stock Exchange. It closed down 8.4 per cent at 6.91 yuan. Its Hong Kong-listed shares declined 1.9 per cent to HK$8.93.

Other telecom service shares also struggled. Shenzhen-traded 263 Network Communications dropped 2.2 per cent to 10.35 yuan and Guomai Technologies fell 2.1 per cent to 10.77 yuan.

In Hong Kong, property developers were among the biggest gainers. Sino Land jumped 3.2 per cent to HK$12.8. Cheung Kong Property climbed 2.4 per cent to HK$51.85. China Resources Land advanced 1.8 per cent to HK$18.84. China Overseas Land & Investment swung higher by 1.8 per cent to HK$22.4.

Chinese department store operator Intime Retail Group rose 0.9 per cent to HK$9.63, after spiking 36 per cent in the previous session. Alibaba Group said Tuesday that it would partner with Intime’s founder Shen Guojun to privatise the company in a deal worth up to HK$19.8 billion.

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