Shanghai marks highest monthly gain in two years, China closes 50m KW of small power plants
China markets ended higher, with mainland shares ending July with the biggest monthly gain in two years. The Shanghai Composite Index rose 2.72 percent led by power generators and metals. The Hang Seng Index finished up 1.68 percent. The China Enterprises Index, which represents Hong Kong listed m.ainland companies, was up 1.1 percent. Taiwan's Taiex added 0.7 percent.
PetroChina (SH:601857; HK:0857) rose 2.88 percent in Shanghai and 1.66 percent in Hong Kong. HSBC (HK:0005) rose 4.6 percent despite analyst predictions that it will report a loss at its first-half earnings next week. BYD Co.1211 advanced 3.12 percent. Warren Buffett's Berkshire Hathaway Inc. has already earned a US$1bn paper profit from an investment it made in the Chinese battery-cum-car maker less than a year ago.
Nonferrous metal shares surged 7.68 percent on average. Jiangxi Copper (SH:600362, HK:0358) surged 10 percent in Shanghai and 7.82 percent in Hong Kong. Chinalco (NYSE:ACH, HK:2600, SH:601600), China's largest aluminum producer, rose 8.15 percent in Shanghai and 3.92 percent in Hong Kong.
Steel companies also rose after the China Iron and Steel Association vowed to keep pressing for a better deal from the annual iron ore price negotiations. Angang Steel (SZ:000898) rose 2.18 percent, Wuhan Steel (SH:600005) lifted 5.01 percent and Liuzhou Iron & Steel (SH:601003) rose 3.25 percent.
Both Hong Kong and mainland real estate developers surged. Hong Kong's Property Index gained 3.46 percent. Hong Kong Property Index gained 3.46 percent. Magnificent Estates (HK:0201) soared 11.45 percent, Hysan Development (HK:0014) rose 10.1 percent Wah Ha Realty Company Limited lifted 10 percent (HK:0278).
China closes 50m KW of small power plants
China yesterday announced it has shut down its target of 50 million kilowatts of small coal-power plants 18 months ahead of schedule. The plants, which represent about 7 percent of China's current generating capacity, were less efficient and much more dirty than larger installations.
Large power companies jumped on the news. Datang International Power Generation (SH:601991, HK:0991), which said first-half profits may climb over 50 percent, rose to the 10 percent limit in Shanghai and 5.4 percent in Hong Kong. Huaneng Power International (SH:600011, HK:0902) rose 4.59 percent in Shanghai and 5.88 percent in Hong Kong. Huadian Power International Corp. Ltd (SH:600027, HK:1071) rose to the 10 percent cap in Shanghai and 8 percent in Hong Kong. Dalian Thermal Power (SH:600719) rose to its 10 percent limit. China Resources Power (HK:0836) rose 5.5 percent.
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