Cnooc falls in Hong Kong on earnings decline report

Cnooc Ltd, China's biggest offshore oil producer, declined the most in almost a month in Hong Kong trading yesterday after the Wall Street Journal said the company's nine-month pretax profit fell 46 percent from a year earlier.

The shares dropped as much as 2.7 percent, the most since September 24, and closed at HK$12.2 yesterday. Cnooc has advanced 70 percent in Hong Kong this year, compared with the 56 percent gain in the benchmark Hang Seng Index.

Pretax profit fell to 28.31 billion yuan ($4.2 billion) and revenue declined about 34 percent to 56.2 billion yuan, mainly because of lower oil prices, the report said, citing an unnamed person familiar with the matter. Xiao Zongwei, Cnooc's spokesman in Beijing, declined to comment on the report.

HK to tender HK$2b 5-year govt bonds on Nov 2

The Hong Kong Monetary Authority (HKMA), as representative of the Hong Kong government, said yesterday that it would tender the following five-year government bonds, under the Institutional Bond Issuance Programme, on November 2. The bonds were expected to trade on the Stock Exchange of Hong Kong on November 4 under the stock code, the HKMA said. This will be the second institutional bond issue under a government bond program announced earlier this year that involves three tenders.

In September, the government sold HK$3.5 billion worth of two-year bonds, the first under the program, at an average yield of 0.59 percent. The deal was oversubscribed by 5.45 times. The third tender, comprising HK$2.5 billion 10-year bonds, is tentatively scheduled for January 11, 2010.

HKMA sells HK$1.938b to keep HKD in trading band

Hong Kong's de facto central bank, the Hong Kong Monetary Authority, yesterday afternoon injected HK$1.938 billion (US$250 million) into the money market to stem an appreciating Hong Kong dollar and keep it within its fixed trading band. The Hong Kong dollar hit the top of its trading band at 7.7500 yesterday as the city continued to attract fund inflows on expectations the US dollar will remain weak, despite a bounce in the past day, dealers said. Recent renewed speculation that the yuan will appreciate is also encouraging investment in Hong Kong-listed shares of mainland companies, they said.

Rusal's Hong Kong IPO plan is unique, UBS's CEO says

United Co Rusal's plan for an initial public offering in Hong Kong is unique as other Russian commodity producers still favor listing in London or Moscow, said Steven Meehan, UBS AG's chief executive officer for Russia.

Rusal, the aluminum maker controlled by billionaire Oleg Deripaska, has applied to sell about 10 percent of the company's shares in Hong Kong as it tries to cut debt of more than $16 billion. Rusal also filed a request to list in Paris, Le Figaro said October 19.

"Rusal is probably in a separate category just given its leverage," Meehan said yesterday in an interview at a UBS investor conference in Moscow, adding, "It's a unique issue. It's looking to do something that's going to be against what conventionally will happen in 2010."

Metals and fertilizer producers may "lead the way" for Russian IPOs next year, he said. Oil and natural-gas producers may come next, followed by retail companies and state-controlled banks, Meehan said, without naming any companies.

The "difficulty" for Rusal will be attracting Western investors to Hong Kong, Meehan said.

No one could immediately be reached at Rusal in Moscow for comment.

China Daily/Agencies

(HK Edition 10/22/2009 page4)