Railway, infrastructure shares rally on Mexican high-speed rail contract

Railway and other infrastructure stocks rallied on news of Chinese companies winning a US$4.4 billion high-speed rail project in Mexico and reports of Beijing's investment plans abroad.

The Hong Kong share price of China Railway Construction Corp (CRCC) rose 3.6 per cent to HK$8.35 yesterday while that of China Railway jumped 4.3 per cent to HK$5.04 after CRCC and CSR Corp won deals as part of the Mexico project.

China Communications Construction (CCC), China's biggest port construction firm, soared 9 per cent to HK$6.57.

"The overall sentiment of infrastructure projects is strong," said CIMB analyst Kevin You.

The central government is planning a 100 billion yuan (HK$126 billion) fund to finance the construction of infrastructure projects domestically and overseas, Bloomberg reported yesterday.

On Monday, the Mexican Secretariat of Communication and Transportation announced that a consortium of Chinese, Mexican and French companies won a contract to build a 210km high-speed passenger railway between Mexico City and the city of Queretaro.