HK stocks rise after Credit Suisse upgrades banks

Hong Kong stocks rose for a third day, led by banks, after Credit Suisse Group raised its ratings on Industrial and Commercial Bank of China Ltd and Bank of China Ltd.

ICBC, the world's most profitable bank, gained 1.2 percent. Bank of China, the nation's third-largest lender, added 1.1 percent. Credit Suisse lifted its recommendation on the shares to "outperform". China Unicom (Hong Kong) Ltd, the country's No. 2 wireless company, added 2.2 percent after Morgan Stanley upgraded the stock to "overweight".

The Hang Seng Index advanced 0.3 percent to 22,268.16, adding to a two-day, 3.4 percent gain. It was the gauge's highest close since October 23. The Hang Seng China Enterprises Index, which tracks so-called H-shares, rose 0.4 percent to 13,367.19.

City's economic growth slowed in third-quarter

Growth in Hong Kong's economy slowed in the third quarter, a Reuters poll shows, following an improvement in consumption and exports after the city pulled out of recession in the three months to June. Economists estimate gross domestic product grew on a seasonally adjusted quarterly basis between July and September, and a handful of analysts who gave precise forecasts estimated the economy expanded a seasonally adjusted 2.2 percent from the preceding three months. That would be smaller than a 3.3 percent increase in the second quarter, which ended Hong Kong's longest recession since the 1997/98 Asian financial crisis.

Compared with a year earlier, GDP probably contracted 1.3 percent in July-September, according to the median estimate of 12 economists. However, that would be an improvement on a 3.8 percent decline in the second quarter. A trading and financial hub, the city has been especially vulnerable to the global downturn, although a Reuters poll shows its economy will rebound 3.4 percent next year as trade recovers.

Property developer Mingfa raises $278m in HK IPO

Chinese property developer Mingfa Group raised $278 million in an initial public offering of shares in Hong Kong after it priced its shares at a level lower than the mid-point of its indicated range. The developer priced 900 million shares at HK$2.39 per share, compared with an indicated price range of HK$2.00-HK$2.89 per share, according to a term sheet obtained by Reuters yesterday. Bank of America Merrill Lynch and Deutsche Bank are the joint bookrunners for the deal.

Mingfa earlier in October postponed the launch of the IPO because the company's valuation expectations did not match those of investors, according to IFR Asia, a Thomson Reuters service.

It later revised down the expected price per share of its Hong Kong initial public offering to a range of HK$2.00-2.89 from HK$3.03-3.79.

HK air cargo throughput rebounds in October

Air cargo throughput via Hong Kong rose in October for the first time since June 2008, up 1.7 percent from a year earlier, a further indication that global trade flows are picking up, data from Hong Kong Air Cargo Terminals Ltd showed yesterday. Cargo exports from the city continued to fall, by 2.8 percent from a year earlier, but that was modest compared with an 18.6 percent drop for the first 10 months of this year. Cargo imports rose 15.4 percent from a year earlier, compared with a 9.8 percent decline in the first 10 months of the year.

China Daily/Agencies

(HK Edition 11/11/2009 page3)