February 12, 2018 2:01 pm JST

Hong Kong stock market rebounds as US equity futures advance

H-share index poised for first gain in six days; Chinese shares climb

HONG KONG (Nikkei Markets) -- Hong Kong shares headed higher on Monday following their steepest weekly loss in nearly a decade, as U.S. equity-index futures pointed toward extended gains for stocks on Wall Street.

The Hang Seng Index was up 0.7% to 29,717.42 by the noon lunchbreak, after slumping 9.5% last week. Tencent Holdings, the most-valuable company listed in Hong Kong, added 2.5% after chalking up its worst weekly decline since March 2014. Apple suppliers Sunny Optical Technology Group and AAC Technologies Holdings climbed 4% and 1.9%, respectively, after the iPhone maker advanced 1.2% on Friday in New York. Energy producers CNOOC and PetroChina were down 1.6% and 0.4%, respectively, by midday after U.S. crude prices dropped 9.5% last week.

Futures on all three major U.S. equity benchmarks pointed to a likely higher opening on Wall Street on Monday, after gains on Friday trimmed last week's losses that had been triggered by worries over rising interest rates. The yield on 10-year U.S. Treasury notes remained near a four-year high after a choppy week.

"U.S. equities rebounded, but U.S. Treasury yields have not declined. So it is hard to know when the forced selling orders in the U.S. will stop," said Felix Man, executive director at Future Land Resources Capital Group. "With the Chinese New Year holiday approaching, I advise investors not to take any buy or sell actions in the Hong Kong stock market this week."

Hong Kong's equity markets will be closed from Friday through Monday for the Chinese New Year, while China's financial markets will close from Thursday through Feb. 21.

Air China was up 7.2%, leading the Hang Seng China Enterprises Index 0.9% higher by noon. The airline's shares had slumped 13.2% last week. In the mainland, the Shanghai Composite Index rose 0.8% following a 9.6% retreat last week, while the yuan traded onshore slipped 0.1% to 6.3053 against the U.S. dollar. The Nikkei Asia300 Index rose 1% as most equity gauges in the region traded higher.

Dongfeng Motor Group rose 1.8% in Hong Kong after reporting a 17.3% increase in January sales to 298,077 units.

Everbright Grand China Assets, which began trading last month, had fallen 3.7% by noon on Monday. Late on Friday, the property manager and leaser said the over-allotment option for its 110.4-million-share initial public offering lapsed without being exercised.

Yuexiu Property was unchanged at HK$1.46 by noon. The stock fell as much as 1.4% earlier in the session, following a 14% drop in contracted sales for January to 3.04 billion yuan ($482.9 million).

Rici Healthcare Holdings tumbled 7.6% after saying it expects a net loss of 50 million yuan to 80 million yuan for 2017, compared with a net profit in 2016.

Television broadcast solutions provider Century Sage Scientific Holdings shed 5.3% after saying it expects to swing to a net loss of at least 130 million yuan following a profit in the year-ago period.

-- Amy Lam

Asia300

Tencent Holdings Ltd.

China

Market(Ticker): HKG(700)
Sector:
Industry:
Technology Services
Internet Software/Services
Market cap(USD): 542,981M
Shares: 9,499.38M
Asia300

CNOOC Ltd.

Hong Kong

Market(Ticker): HKG(883)
Sector:
Industry:
Energy Minerals
Oil & Gas Production
Market cap(USD): 65,085.4M
Shares: 44,647.5M
Asia300

PetroChina Co., Ltd.

China

Market(Ticker): HKG(857)
Sector:
Industry:
Energy Minerals
Integrated Oil
Market cap(USD): 219,445M
Shares: 183,021M
Asia300

Air China Ltd.

China

Market(Ticker): HKG(753)
Sector:
Industry:
Transportation
Airlines
Market cap(USD): 26,086.8M
Shares: 14,524.8M
Asia300

Dongfeng Motor Group Co., Ltd.

China

Market(Ticker): HKG(489)
Sector:
Industry:
Consumer Durables
Motor Vehicles
Market cap(USD): 10,522M
Shares: 8,616.12M

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