HK stocks close up 1.06% on strength in Chinese banks

09:05, March 28, 2011      

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Hong Kong shares ended 1.06 percent higher on Friday as better-than-expected results from state-run Bank of China lifted hopes for strong results from other large Chinese lenders.

Hong Kong stocks rose 243.39 points, or 1.06 percent, to close at 23,158.67 on Friday. The benchmark Hang Seng Index traded between 23,068.09 and 23,179.26. Turnover totaled 86.60 billion HK dollars (11.11 billion U.S. dollars).

The Hang Seng China Enterprises Index went up 143.60 points, or 1.12 percent, to close at 12,975.54.

Four sub-indices all gained ground, with the Finance sub-index soaring the most by 1.82 percent, followed by the Properties 1.46 percent, the Utilities 0.52 percent, and the Commerce and Industry 0.15 percent.

Bank of China, the country's fourth-largest lender by assets, rose 2.6 percent to 4.27 HK dollars after reporting on Thursday a 29 percent rise in 2010 net profit to 104.42 billion yuan (15.9 billion U.S. dollars), driven by steady loan growth and a mild recovery in its interest margin.

The results are the first in a series of annual reports from China's major banks. Despite slower loan growth following a series of rate hikes, analysts expect mainland lenders to continue to record bumper interest income due to the residual impact of a government-led lending binge in the past two years.

Bank of Communications was up 2.1 percent at 8.26 HK dollars, China Construction Bank rose 2.0 percent to 7.32 HK dollars, and Industrial and Commercial Bank of China gained 1.9 percent to 6.37 HK dollars.

BOC Hong Kong, the Hong Kong arm of Bank of China, rose 2.1 percent to 24.40 HK dollars after it reported on Thursday its net profit last year rose 16 percent to 16.20 billion HK dollars.

Trading firm Li and Fung was the day's worst performer, plunging 9.1 percent to 39.05 HK dollars. The company said on Thursday its net profit last year rose 27 percent to 4.28 billion HK dollars (549 million U.S. dollars), lower than the average 5.03 billion HK dollars estimated from 13 analysts surveyed by Thomson Reuters.

China Coal fell 3.0 percent to 10.22 HK dollars after it said on Tuesday its net profit rose 4.4 percent last year to 6.91 billion yuan, below the average 9.97 billion yuan forecast of 20 analysts polled earlier by Thomson Reuters.

Heavyweight HSBC Holdings gained 2.5 percent to 82.20 HK dollars, while Hang Seng Bank rose 1.8 percent to 124.00 HK dollars.

Among other blue chips, HKEX, the city's sole bourse operator, closed 1.6 percent higher to 168.80 HK dollars. Hutchinson Whampoa dropped 0.7 percent to 91.05 HK dollars. (7.795 HK dollars = 1 U.S. dollar)

Source: Xinhua
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