Hong Kong stocks settle higher as oil companies, Apple suppliers climb

Buying increases amid fears Typhoon Haima will force markets to close on Friday

PUBLISHED : Thursday, 20 October, 2016, 9:00am
UPDATED : Thursday, 20 October, 2016, 10:58pm

Hong Kong markets ended higher on Thursday, as gains in energy shares and companies linked to technology giant Apple helped offset weakness in the real estate sector.

Meanwhile, some analysts said fears that Hong Kong’s markets may be forced to close on Friday due to an approaching typhoon had also encouraged buying.

Mainland markets were essentially flat as investors continued to digest China’s economic data, which showed steady growth in the third quarter.

Hong Kong’s benchmark Hang Seng Index rose 0.3 per cent or 69.43 points to 23,374.40, while the Hang Seng China Enterprises Index, or the H-shares index, gained 0.5 per cent or 45.16 points to 9,686.38.

Daily turnover was virtually unchanged at HK$54 billion from Wednesday’s HK$54.5 billion.

“We expect funds from the mainland to flow to Hong Kong in the near term, as the Shenzhen-Hong Kong Stock Connect will be launched late next month and the US dollar has strengthened lately,” said Stanley Kao, an analyst at Shenwan Hongyuan Securities.

Kenny Tang, the financial planning general manager for AMTD, said investors may have been buying more amid fears that Typhoon Haima might cause the market to close on Friday.

He said that overall market sentiment was positive after China’s latest economic data, released on Wednesday. It showed that GDP growth in the third quarter was in line with expectations at 6.7 per cent. Retail sales in September jumped 10.7 per cent, although industrial production growth was below expectations at 6.1 per cent year-on-year, the slowest pace since May.

Mainland markets were almost unchanged today, with the benchmark Shanghai Composite Index down 0.26 points, or less than 0.1 per cent, to 3,084.46.

The large-cap CSI300 Index ticked higher, up 0.1 per cent or 2.36 points to 3,318.6. The Shenzhen Component Index rose 0.3 per cent or 26.41 points to 10,784.33, and the Shenzhen Composite Index closed 0.3 per cent or 6.6 points higher at 2,060.39. The startup board ChiNext Index gained 0.4 per cent or 8.35 points to close at 2,193.26.

Combined turnover for the Shanghai and Shenzhen markets decreased slightly to 475 billion yuan from Wednesday’s 495.5 billion yuan.

“The Shanghai Composite currently faces a resistance level at 3,100. We advise investors to be cautious in today’s markets, as a number of risks lurk in the medium term, including the yuan’s depreciation, the outcome of the US election, and a possible rate lift-off by the Fed before year-end,”

said analysts from Orient Securities in a note on Thursday.

In Hong Kong, energy shares bubbled higher, as the US oil benchmark settled at a 15-month high overnight after data showed an unexpected drop in American crude inventories.

State-owned energy giant PetroChina was the top gainer among blue-chips, jumping 3 per cent to HK$5.54. Cnooc, China’s largest offshore oil producer and also a Hang Seng constituent, hit a 52-week high of HK$10.84 during trading, and closed up 2.1 per cent at HK$10.68. China Oilfield Services surged 5.4 per cent to HK$7.98, the best performer on the H-shares index.

Apple-related stocks benefited from news that the US technology giant is preparing for an event next Thursday at which it is expected to launch new MacBook computers.

Aac Technologies Holdings, which supplies acoustic components to Apple, climbed 2.7 per cent to HK$80.05, making it the second biggest gainer among blue-chips.

FIH Mobile, which makes smartphones for Apple, soared 7.4 per cent to HK$2.77.

Several Hong Kong property stocks struggled with losses, as investors turned cautious after Federal Reserve Bank of New York President William Dudley said late on Wednesday that he expected to see “an interest rate rise later this year”.

New World Development fell 1 per cent to HK$9.56, while Sino Land dropped 0.6 per cent to HK$12.98 and Sun Hung Kai Properties lost 0.5 per cent to HK$114.2.