Hong Kong stocks end higher on property gains; Hang Seng advances for third straight week
- Link Reit climbs 2.8 per cent after ‘buy’ rating from Daiwa Capital
- In China, benchmarks end lower as investors stay on sidelines amid economic concerns
Hong Kong stocks inched up Friday, with gains in selective local property stocks helping keep the index afloat. China benchmarks ended lower, as investors stayed on the sidelines amid uncertainties on China’s economic outlook.
The Hang Seng ended the week up less than 0.3 per cent at 27,811.35. Turnover of the main board was thin.
The CSI 300 of large cap stocks traded in Shanghai and Shenzhen slipped 0.2 per cent lower to close at 4,017.25, while the Shanghai Composite Index lost 0.4 per cent to 3,004.94.
Link Reit, Asia’s largest real estate investment trust, saw its shares climb 2.8 per cent to HK$81.10, after Daiwa Securities raised its rating to “buy” from “outperform”, with price target set at HK$97.6, implying a 20 per cent upside from Friday close.
The upgrade followed Asia’s biggest real estate investment trust saying Thursday that it had entered an agreement to buy a 10-storey grade A office building in Sydney for A$683 million (US$469.5 million) from US private equity firm Blackstone.
Other property stocks also gained, with Wharf REIC rising 2.8 per cent to HK$45.95, while China Overseas Land & Investment climbing 2.1 per cent to HK$29.6 and Hang Lung Properties advancing 1.9 per cent to HK$16.9.
Trading is likely to be sluggish next week due to the Christmas-related holidays in Hong Kong, said Alvin Cheung, an associate director at Prudential Brokerage. The Hong Kong market will close after the morning session on Tuesday and reopen on Friday.
However, “if you look at how much uncertainty we have had for the entire year, with the US-China trade war and the nearly seven-months-long protests sinking the Hong Kong economy into recession, the Hang Seng Index is still up by about 7.8 per cent from the end of last year,” Cheung said.
“To me, what’s significant is the Hong Kong benchmark has managed to stay ahead despite so many fears in the market this year,” said Cheung.
Elsewhere, China Mobile was the top index point-gainer, up 2.4 per cent to HK$63.95. Its gain helped negate the losses by Tencent, which slipped 0.1 per cent to HK$375.2.
In China, loan prime rates (LPR) for December were left unchanged, with the one-year rate kept at 4.15 per cent and five-year at 4.8 per cent. Introduced in August to replace the benchmark lending rate, the LPR is the average of the 18 reporting banks’ lending rate to their highest quality borrowers. It is used to price loans to both individuals and businesses.
Investors were watchful on further supportive measures from the government and central bank that could stimulate China’s slowing economy, as its third quarter GDP growth slowed to 6 per cent, the slowest in almost three decades.
Tech stocks weighed on the mainland indexes Friday. Universal Scientific Industrial (Shanghai) dropped 9.5 per cent to 20.36 yuan, while Wuxi AppTec lost 1.9 per cent to 92.5 yuan.
ZTE lost 3.3 per cent to 33.37 yuan; and Shenzhen Mindray Bio-Medical Electronics lost 1.8 per cent to 176.05 yuan.
