HK Shares End Lower On Chinese Banks; China Mobile Down
Hong Kong stocks ended lower Thursday due to profit-taking in Chinese banks, while China Mobile declined on concerns about its plan to buy a stake in Shanghai Pudong Development Bank.
The blue-chip Hang Seng Index fell 301.01 points, or 1.4%, to 20,575.78 after trading between 20575.78 and 21,000.13.
Market volume totaled HK$62.68 billion, up from HK$59.9 billion Wednesday.
Analysts said investors will remain cautious as they await cues from the Chinese People's Political Consultative Conference and National People's Congress sessions in Beijing, as the meetings will be of particular importance this year, when the country's 12th Five-Year Plan will be drafted. The CPPCC is an advisory body, while the NPC is the legislature. The 10-day NPC session starts Friday.
Alvin Cheung, associate director at Prudential Brokerage, said he expects the index to trade in 20,500-21,000 in the coming sessions.
'Investors were cautious in run-up to the annual meetings of the Chinese People's Political Consultative Conference and National People's Congress (because of concerns about potential policy changes),' he said.
China banks fell on profit-taking after recent rises. ICBC ended down 2.5% at HK$5.75, China Construction Bank fell 2.9% to HK$5.96 and Bank of China fell 3.5% to HK$3.89. The three banks had risen 6.0%-8.7% in the previous four sessions, outpacing the benchmark Hang Seng Index's 2.3% rise during the period.
China Mobile fell 2.4% to HK$72.85 after it said Wednesday it is in talks to buy a stake in Shanghai Pudong Development Bank.
'It's difficult for China Mobile to link up with a bank, and investors are concerned China Mobile may cut its dividend as a result of the acquisition,' said Cheung.
Cheung Kong Infrastructure rose 1% to HK$29.65 after it said its net profit for 2009 was up 26% at HK$5.57 billion.
'It's a defensive play, judging from its trading range so far this year, while the slightly better-than-expected results are not providing much of a further boost to the stock,' said Steven Leung, director of institutional sales at UOB KayHian.
Standard Chartered rose 5.7% to HK$193.40 after it said its net profit for 2009 rose 4.7%.
