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Stocks

Financials, Tencent take Hong Kong shares to 22-month highs

HONG KONG (Nikkei Markets) -- Hong Kong shares revisited their highest levels since July 2015 on Monday, spurred by gains in financial stocks and heavyweight Tencent Holdings after a recovery on Wall Street soothed sentiment.

The Hang Seng Index advanced 0.9% to 25,391.34. HSBC Holdings rose 1%, while mainland insurer Ping An Insurance Group rose 4.1% to a near two-year high, and China Life Insurance added 2.5%. Internet major Tencent jumped 2.6% to a record after reporting better-than-expected quarterly earnings last week.

Risk sentiment received a boost after U.S. indexes rose Friday, and as global crude oil prices headed for their fourth consecutive advance. Concern about the fate of U.S. President Donald Trump's proposed economic policies had rattled nerves last week after reports about his interference in a federal investigation. The dollar index, measured against a basket of currencies, slumped more than 2% last week and continues to hover near six-month lows.

"We are still not comfortable on equities generally with the U.S. political uncertainty and the fact does remain that Trump will find it difficult to push his economic agenda," said Steven Leung, executive director of institutional sales at UOB Kay Hian. "Further upside for Hong Kong stocks from here looks a bit difficult."

The Hang Seng Index, up more than 15% so far this year, is on course for its fifth consecutive monthly advance.

Investors shrugged off the weakness in mainland markets, where the Shanghai Composite shed 0.5% and the Shenzhen benchmark dropped 1.4%.

Most developers in Hong Kong ended lower after the city's central bank on Friday tightened mortgage financing to help cool an overheating property market. Cheung Kong Infrastructure Holdings, a subsidiary of CK Hutchison Holdings, fell 1.1% and New World Development lost 0.7%.

FIH Mobile, a Hong Kong listed subsidiary of Hon Hai Precision Industry, slumped 4.8% after forecasting a net loss of up to $240 million for the six months ending June 30.

TK Group Holdings surged 9.7% after the plastic mold and component maker said it expects to record an "increase" in profit for the four months ended April 30.

Zoomlion Heavy Industry Science and Technology jumped 3.8% after saying it will sell 80% stake in its wholly-owned environmental subsidiary for 11.6 billion yuan ($1.7 billion).

Kingsoft added 4.3% following a nine-fold increase in net profit at its subsidiary Cheetah Mobile.

China Oriental Group slid 4.2% after saying the company and its directors received a summons filed by steelmaker and major shareholder ArcelorMittal for inspection of certain documents related to the Beijing-based company's new share placement in January. China Oriental is currently seeking legal advice with regards to the summons. ArcelorMittal has a 39% stake in the Chinese company, according to ArcelorMittal's annual report for 2016.

ITC Properties Group fell 2.5% after saying it expects a "significant" decrease in net profit for the year ended March 31.

O Luxe Holdings ended 1.3% higher after the jewelry-maker swung to a profit for the six months ended March 31.

Melco International Development rose 1.5%. Entertainment Gaming Asia late Friday said its board of directors remains "neutral" toward Melco's unsolicited cash tender of $2.35 per share. Entertainment Gaming shares ended little changed at $2.23 on Friday.

-- Nimesh Vora

-- 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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