China shares rise on c.bank liquidity support, HK follows

China Modern Dairy Holdings

07/11/2014 04:55

* HSI +0.1 pct, H-shares +1.0 pct, CSI300 +0.8 pct 
    * Mainland, HK brokers post solid gains 
    * Investor confidence up on c.bank injection 
 
    SHANGHAI, Nov 7 (Reuters) - China shares rose on Friday, 
buoyed by strength in brokerages as investors regained 
confidence after the Chinese central bank pumped liquidity into 
the financial system to help the economy. 
    The Shanghai Composite Index  .SSEC  rose 0.6 percent to a 
20-month high of 2,440.3 points by midday, while the CSI300 
 .CSI300  of the leading Shanghai and Shenzhen A-share listings 
gained 0.8 percent, to touch its highest since early June last 
year. 
    For the week, the mainland indexes are set to climb 0.8 
percent and 0.7 percent, respectively, which would mark a second 
straight week of gains.  
    The central bank said on Thursday that it had pumped 769.5 
billion yuan ($125.8 billion) worth of three-month loans into 
banks via a "medium-term lending facility" (MLF) to keep 
interest rates low.  ID:nL4N0SW4UO  
    Analysts said the move by the central bank could help to  
boost stock investors' confidence as well.  
    "I've seen investors are confident to buy into those 
low-valuation heavyweight stocks," said Du Changchun, analyst at 
Northeast Securities in Shanghai, adding that strong performance 
by blue chips would provide key support for the index.   
    Brokerage stocks bolstered the main indexes, with Huatai 
Securities Co Ltd  601688.SS  rising 8.3 percent, while 
Industrial Securities Co Ltd  601377.SS  hit its 10 percent 
daily limit.  
    Haitong Securities Co Ltd  600837.SS  and CITIC Securities 
Co Ltd  600030.SS , the country's top two brokerage firms, rose 
5.3 percent and 5.5 percent, respectively.  
    Other financials also outperformed, with the CSI300 
financials sub-index  .CSI300FS  firming 2 percent to hit its 
best level since Sept. 2013. The SSEC financials sub-index 
 SSEFN  rose 1.7 percent.  
    China Life Insurance Co Ltd  601628.SS  and China Citic Bank 
Corp Ltd  601998.SS  both gained 2 percent. 
     
    HONG KONG MIXED 
    Hong Kong shares reversed early losses by midday, as a 
strong brokerage sector helped temper selling pressure. 
    The Hang Seng Index  .HSI  was up 0.1 percent at 23,682.6 
points. The China Enterprises Index  .HSCE  of the top Chinese 
listings in Hong Kong gained 1.0 percent. 
    For the week, the two indexes were down 1.3 percent and 0.8 
percent, respectively. 
    Analyst said investor were taking profits from the market 
after previous rallies. 
    Linus Yip, chief strategist at First Shanghai securities in 
Hong Kong, said the current reporting season posed no surprise 
as most blue chip companies had reported earnings within market 
expectations. 
    Brokerage shares rose, led by CITIC Securities  6030.HK  
which announced solid October net profit on Thursday. Shares of 
CITIC Securities were up 5.3 percent and Haitong International 
 0665.HK  rose 4.1 percent.  
    The information technology sector was the biggest loser. 
Lenovo extended losses from Thursday despite reporting a 19 
percent jump in net income in the second fiscal quarter, but 
revenue fell short of analyst expectations.  ID:nL4N0SW26W  
    Tencent Holdings Ltd  0700.HK  shed 0.3 percent after the 
company signed a commitment to "self-manage" comments on its 
website together with 28 Chinese video portals.  ID:nL4N0SW6DO  
    Ping An Insurance Group  2318.HK , China's second largest 
insurer, halted trading on Friday morning.  
   ($1 = 6.1156 Chinese yuan) 
 
 (Reporting by Shanghai Newroom; Editing by Jacqueline Wong) 
 ((yixin.chen@thomsonreuters.com; +86 21 61041713; Reuters 
Messaging: yixin.chen.thomsonreuters.com@reuters.net)) 
 
Keywords: MARKETS CHINA STOCKS/MIDDAY