Telecom, Ping An Insurance shares rise in HK; China stocks mixed on data showing continuing economic weakness

15-Mar-2019 Intellasia | South China Morning Post | 6:00 AM Print This Post

Hong Kong shares were flat while mainland benchmarks were mixed, as China released data showing continuing weakness in the economy, with industrial output slowing to its lowest level in a decade.

The Shanghai Composite Index was down about 0.52 per cent at 11.43 am HK time, while the CSI 300, which tracks blue chips listed on the Shanghai and Shenzhen bourses, posted teensy gains. Hong Kong’s Hang Seng was up within the first hour of trading, by 0.2 per cent, but ticked lower at 11:43am by 0.16 per cent, to 28760.13.

After the open, China released a hefty platter of data, which traders were only beginning to digest.

China’s industrial output growth slowed to 5.3 per cent in January and February, year-on-year, down from 5.7 per cent in December and lower than estimates in Bloomberg and Reuters surveys. Meanwhile, surveyed unemployment jumped from 4.9 per cent to 5.3 per cent, the highest rate since February 2017.

Retail sales rose 8.2 per cent in January and February year-on-year, the same as in December and in line with expectations.

Linus Yip Sheung Chi, chief strategist of First Shanghai Securities, called the drop in industrial output “not that huge,” adding that he does not expect markets to react strongly to the data as trading continues in the day because the slowing economy had been baked into share prices already.

“It did reflect on the impact from the ongoing US-China trade war, as a reflection on how factories and manufacturers have been cautiously adjusting their internal operational planning in view of higher tariffs imposed by the US,” he said.

In Hong Kong, China Unicom was up 3.3 per cent at HK$9.94. The telecom operator reported Wednesday that its net profit jumped five-fold for full year 2018, at 10.2 billion yuan, beating expectations by Refinitiv.

Traders said the positive news from China Unicom will benefit other telecom stocks listed in Hong Kong, such as China Mobile, which rose 0.53 per cent, HK$84.85. China Telecom was up 2.16 per cent, at HK$4.26.

However in China, the A-share of China Unicom China United Network Communciations was down 4.21 per cent, at 6.83 yuan.

Ping An Insurance was up 1.07 per cent, at HK$84.9. Investors cheered news that its chief financial officer, Jason Bo Yao, said it would extend its share buy-back programme to include Hong Kong-listed H shares. The company said Tuesday it has allocated 10 billion yuan to buy-back its Shanghai traded A-shares over the next 12 months.

Meanwhile, Cathay Pacific rose 1.48 per cent to HK$13.68. On Wednesday, it reported a net profit of HK$2.34 billion, halting two straight years of losses, supported by successful cost-cutting measures. After its annual results, several brokerages, such as Goldman Sachs and Macquarie, have raised their target prices for the stock, with Macquarie raising the target to $16.2.

Doumob, which offers online advertising services in China, debuted on Hong Kong’s main board at 62 HK cents, up 51 per cent from its listing price of 41 HK cents.


Category: Hong Kong

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