Hong Kong and Shenzhen extend gains, Shanghai nudges up under weight of IPOs
China markets rose today, with Hong Kong making a 1.5 percent leap after data showed fewer job cuts in the United States in August. The Shanghai market nudged up 0.7 percent as forthcoming IPOs announcement weighed on previous gains. The Shenzhen bourse however was up 2.1 percent.
Turnover in Hong Kong dropped slowed to HK$64bn from Friday's HK$76bn. The China Enterprises Index, which represents top Hong Kong-listed mainland stocks, was up 1.9 percent
Mainland markets started gains on the back of news released after close on Friday that investment quotas for the Qualified oreign Institutional Investors (QFII) is to be increased to US$1bn from the current US$800m.
In Shanghai, winning shares outpaced losers by 581 to 257 with turnover moving up to RMB146bn billion yuan from Friday's RMB142bn.
However, news on Friday evening and today that IPOs would continue put a limit on gains. China approved offerings from China National Chemical Engineering Co. and Metallurgical Corp. of China, which is launching this year's second-largest IPO tomorrow with its RMB19bn offering.
China Construction Bank (HK:0939, SH:601939), rose 1.8 percent in Hong Kong and 0.2 percent in Shanghai. Bank of China (HK:3988) was up rose 3.8 percent in Hong Kong. Bank of Beijing (SH:601169) rose 4.3 in Shanghai.
China today announced that its H1N1 victim-count may double to 10,000 over the winter with more than 100 people across China have been infected with H1N1 flu over the weekend. Vaccine-makers made large gains, including Hualan Biological (SZ:002007), Da An Gene Co., Ltd. of Sun Yat-Sen Uni. (SZ:002030) and Shanghai Kehua Bio-Engineering Co., Ltd. (SZ:002022) which all jumped to the 10 percent daily limit after the government ordered 7.3 million doses of vaccines from Hualan and Sinovac Biotech (NYSE:SVA) on Friday.
China Unicom (HK:0762, NYSE:CHU) rose 3 percent after Spain's Telefonica (MC:TEF) said yesterday that the two companies had agreed to buy US$1bn worth the other's shares as part of a strategic alliance. Telefonica will now hold an 8.06 percent stake in Unicom while Unicom will hold roughly 0.89 percent in Telefonica.
Auto shares rose after China said car sales may rise accelerate 28 percent from a year ago to reach 12 million vehicles this year, overtaking the US. Geely Automobile Holdings Ltd. (HK:0175) rose 5.8 percent. Denway Motors Limited (HK:0203) was up 3.9 percent. Weichai Power Company Limited (HK:2338) rose 2.4 percent.
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