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Hong Kong stocks advance, fulled by Geely Auto; Tencent matches record high

Hong Kong stocks advance, fulled by Geely Auto; Tencent matches record high

HONG KONG: Hong Kong stocks rose on Monday, fuelled by a surge in Geely Auto after the Chinese car maker said it will form a joint venture with Volvo and develop electric car technology, while Tencent edged close to a fresh record. The Hang Seng Index added 0.5 per cent, or 122.98 points, to 26,829.07 by the midday close. The Hang Seng China Enterprises Index, known as the H-share index, gained 0.3 per cent, or 31.42 points, to 10,818.55. Last week, the Hang Seng Index posted its longest winning streak in more than four years, having risen for nine consecutive sessions through Thursday. Geely Auto led gains in blue-chip stocks, rallying 5.9 per cent to HK$18.62.

Several investment banks have maintained their positive ratings for the stock, including Nomura and Daiwa Capital, after Geely Auto said last week that it will deepen ties with its subsidiary Volvo Car and establish a 50-50 joint venture to produce systems for electric cars. Index heavyweight Tencent touched HK$300.6 in early trade, matching a previous record set last week. It pared gains by the midday break, but was still up 0.9 per cent to HK$299.8. Casino stocks jumped after JP Morgan raised its target prices for four players in the industry, including Galaxy Entertainment, Sands China, SJM Holdings, and Wynn Macau. Galaxy Entertainment jumped the most among casino stocks, rising 3 per cent to HK$47.55. Cheung Kong Infrastructure advanced 2.9 per cent to HK$71.75 after a group of investment banks, including Credit Suisse and Daiwa Capital, raised their target prices for the shares after the company reported first-half profit rose 2.7 per cent on year. Mobile carrier China Unicom also added 0.5 per cent to HK$11.48, after saying it is in negotiations to introduce strategic investors.

Previously, a Reuters report said Baidu and will join other big Chinese tech firms to jointly invest about US$12 billion in China Unicom’s Shanghai-listed unit. In the mainland, the benchmark Shanghai Composite Index edged up 0.2 per cent, or 5.79 points, to 3,243.77. The large-cap CSI300 also added 0.3 per cent, or 10.18 points, to 3,738.78. However, the ChiNext Price Index, a gauge of China’s start-up stocks, lost 0.7 per cent, or 11.89 points, to 1,678.26. The Shenzhen Composite Index also fell 0.1 per cent, or 1.46 points, to 1,844.35. On Friday in New York, the Dow Jones Industrial Average fell 0.2 per cent to close at 21,580.97. The S&P 500 and the Nasdaq Composite lost 0.91 point and 2.25 points each, finishing at 2,472.54 and 6,387.75. General Electric declined 2.9 per cent to its lowest level in nearly two years after reporting a drop in second-quarter net income.