China shares outshine Asia, Lift Hong Kong, on encouraging data

Shanghai – Reuters:

China shares outperformed others in Asia early Monday, lifting Hong Kong markets, as August inflation and trade data added to optimism that growth has stopped slowing in the world’s second-largest economy.

 

Shanghai-related counters again had solid gains after the official Shanghai Securities News reported on Monday that companies operating in the city’s new free-trade zone may enjoy special tax exemptions.

“Market sentiment has been turning more and more positive, with the A-share market strong. But there’s still not a lot of fresh buying,” said Jackson Wong, Tanrich Securities’ vice-president for equity sales.

Chinese shipping shares were also supported by resurgent freight rates, with the Dry Baltic Index again hitting its highest since January 2012. Sinotrans Shipping jumped 3.4 percent to be up 20 percent this month in Hong Kong.

 

China Shipping Container Lines (CSCL) surged by the maximum 10 percent limit in Shanghai and 3.7 percent in Hong Kong. CSCL Shanghai shares have rebounded 40 percent from a trough on Aug. 23, one day after China’s cabinet approved the establishment of a free trade zone in Shanghai.

Ping An Bank also soared 10 percent to 12.13 yuan in Shenzhen after its parent, Ping An Insurance Group , said it will acquire up to 1.32 billion new shares in the bank at 11.17 yuan per share, raising its stake to 59 percent.

Financials were also boosted by official data that showed China’s annual consumer inflation was 2.6 percent in August, in line with market expectation.

Producer prices fell 1.6 percent last month from a year earlier, compared with a fall of 2.3 percent in the previous month and slightly less than an expected fall of 1.8 percent.

This follows data on Sunday that showed China’s exports rose 7.2 percent in August from a year earlier and imports rose 7 percent, producing a trade surplus of $28.6 billion for the month.

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