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Equities

Hong Kong stocks post fourth monthly gain, paced by AAC, AIA

HONG KONG (Nikkei Markets) -- Hong Kong stocks clinched a fourth monthly advance, thanks to a rally this week, as investors cheered the outcome of French elections and insurers surged on signs of improved business growth in China.

The Hang Seng Index has climbed 2.4% since last Friday, erasing accumulated losses in April and capping its longest streak of monthly gains in two years, even as it fell 0.3% from a 21-month high on Friday. AIA Group, China Life Insurance and Ping An Insurance Group all ranked among the week's best stocks, helping Hong Kong maintain its position as one of the best-performing markets in Asia so far in 2017.

AAC Technologies Holdings surged more than 25% in April amid expectations the Apple vendor's earnings may get a further boost as the U.S. smartphone maker prepares to launch the iPhone's next iteration. Cheung Kong Infrastructure Holdings jumped almost 12% in April after Australia approved the takeover bid of the CKI-led consortium for power distributor Duet Group. AAC jumped 5.4% and CK Infrastructure added 0.5% in Friday's trading.

Global equity markets received a boost this week as Emmanuel Macron's victory in the first round of the French presidential elections helped ease worries about stresses within the European Union. Macron, who is seen as a business-friendly candidate favoring the E.U., is pitted against far-right rival Marine Le Pen in the final election round next month.

"Global markets are looking strong, and I think there is not much chance that we see Le Pen winning in a week's time," said Victor Au, chief operating officer at Delta Asia Securities.

The Hang Seng Index's 2.1% advance in April sustained even as mainland markets posted their worst monthly decline this year amid increased efforts by regulators to rein in financial risks and clamp down on excessive speculation. The Shanghai Composite Index inched up 0.1% on Friday, paring its monthly loss to 2.1%. A gauge of mainland companies listed in Hong Kong fell 0.5% in April, underperforming the Hang Seng Index.

Friday's losses in Hong Kong came as investors digested a slew of quarterly earnings before a three-day weekend.

Shares of major Chinese banks declined before three of the nation's four largest reported earnings at the end of Friday's trading. Industrial & Commercial Bank of China (ICBC) slipped 0.6% before it reported a 1.4% increase in quarterly net income to 75.8 billion yuan ($11 billion). Agricultural Bank of China (ABC) slid 0.3% ahead of its statement that the January-March net income rose about 2% to 55.71 billion yuan. Bank of China (BOC) slipped 0.3% before the state-owned lender posted flat earnings of 46.65 billion yuan.

Also at the end of the day's trading, Belle International Holdings said a consortium including private-equity firms Hillhouse Capital Group and CDH Group offered to take the footwear major private in a deal worth $6.8 billion. The offer price of HK$6.3 per share compares with Belle's last price of HK$5.27 on April 13, before trading was halted April 18 at the company's request.

Anhui Expressway rose 0.2% after the company reported a more than 15% increase in quarterly net income.

BAIC Motor shares fell 3.4%, paring this year's gains to 8.6%, after the company posted a 56% increase in profit for the quarter ended March 31.

-- Nimesh Vora and V. Phani Kumar

-- Nikkei Markets is a real-time financial news service for South East Asia's markets published by Nikkei NewsRise Asia Pte Ltd, a Nikkei and NewsRise joint venture company. Nikkei Markets provides wide companies coverage in the region, including the Nikkei's Asia300 companies.

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