Monday, August 27, 2007

HK Shares Rose on Expected Funds from Mainland

The Hang Seng Index rose sharply on the opening and continued strongly to close up 655 at 23,577.

Today is the first day that the Bank of China Tianjin Branch can officially open accounts for Mainland clients to invest directly in HK shares. Investors believe that valuations of H-shares (Mainland issues) will rise to close the gap with their A-share prices.

Construction Bank of China "CCB" (#939) performed strongly on good results and disclosure that it had only minor exposure to the sub prime mess. The Mainland's 3rd largest bank closed at $6.15, the highest level since listing in October 2005.

Shanghai hit its sixth consecutive record closing high. The Mainland market is now 60% more expensive than HK on average.

Market Indices
  • Hong Kong Hang Seng: 23,577.73 +2.86%
  • Japan Nikkei: 16,301.39 +0.32%
  • Shanghai Composite: 5,150.11 +0.83%
  • Singapore STI*: 3,388.44 +0.56%
  • South Korea Composite: 1,803.03 +0.65%
  • Taiwan Weighted: 8,718.31 +0.32%

*Intraday trading

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