Hong Kong shares end higher

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Hong Kong - Hong Kong stocks climbed 0.88 percent Monday, a fifth-straight gain as news that Beijing had given approval to three private lenders on the mainland fuelled hopes for further reforms of the banking sector.

The benchmark Hang Seng Index jumped 212.62 points to 24,428.63 on turnover of HK$85.46 billion (R116 billion).

Chinese regulators said Friday the government had approved the setting up of three private banks in a long-awaited economic reform aimed at boosting competition.

The China Banking Regulatory Commission (CBRC) said it had approved private banks in the southern boomtown of Shenzhen, the northern port city of Tianjin and the eastern city of Wenzhou, which is known as the cradle of private enterprise in China.

The move followed a declaration by the government in March that it would reform China's banking sector, which is dominated by four state-owned banks.

“The target is to provide efficient and diversified financial services to support the development of the real economy,” CBRC chairman Shang Fulin was quoted as saying in a statement.

Also in Hong Kong, Tencent added 3.2 percent to HK$128.9 and HSBC rose 0.67 percent to HK$82.25.

On the back of the reforms, state-owned Bank of China put on 1.37 to HK$3.7 and Industrial and Commercial Bank of China (ICBC) 1.54 percent, to HK$5.28.

In China the benchmark Shanghai Composite Index jumped 2.41 percent, or 51.34 points, to 2,177.95 on turnover of 180.4 billion yuan (R309 billion).

The Shenzhen Composite Index, which tracks stocks on China's second exchange, gained 2.01 percent, or 22.31 points, to 1,133.83

on turnover of 149.7 billion yuan.

“Investors' expectations towards the domestic economy are good, especially after the release of June industrial profits,” Shenyin & Wanguo Securities analyst Qian Qimin told AFP.

Profits at China's industrial enterprises surged 17.9 percent year-on-year in June, state media reported over the weekend.

“Buying of financial stocks, supported both by their low valuations and investors' hopes for reform, also boosted the market,” he added.

Among the most actives, state-owned Bank of Communications approached its 10 percent daily limit to 4.22 yuan in Shanghai after media reports that it plans to bring in private investors to pilot mixed ownership.

Other banks were higher in Shanghai. Agricultural Bank of China

gained 3.27 percent to 2.53 yuan while ICBC rose 2.27 percent to 3.60 yuan.

Investors also bought brokerages on forecasts for strong earnings in the first half.

Founder Securities soared 7.22 percent to 6.09 yuan in Shanghai while GF Securities advanced 4.26 percent to 10.52 yuan in Shenzhen. - Sapa-AFP


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