Trade settlement to exceed 1tr yuan

Hong Kong's trade settlement denominated in yuan will exceed 1 trillion yuan this year, the city's Chief Executive Donald Tsang said on Tuesday at a forum.

The bulk of the settlement is with Guangdong province, he said.

COSCO to name Ma as new CEO

China COSCO Holdings Co Ltd will name Ma Zehua as chief executive on Wednesday, replacing Wei Jiafu who will retain his position as chairman, a company official told Reuters on Tuesday.

"This is a role change for Captain Wei. The action has nothing to do with his capabilities or his business performance, but because of his age. This is normal for state-owned enterprises," said the COSCO official, who asked not to be identified.

Avoid consumer stocks: Daiwa

Investors should avoid mainland consumer-discretionary stocks traded in Hong Kong as slowing profits and increased risk aversion drag their shares lower, Daiwa Capital Markets said.

Chinese consumer-discretionary stocks would fall as much as 56 percent if there was a repeat of the 2008-2009 economic downturn, Peter Chu, an analyst at Daiwa, wrote in a report dated August 22. "We expect most of the China consumer-discretionary stocks we cover to record year-on-year slowdowns in both turnover and net profit for 2012," he wrote.

Stocks gain on mainland data

Hong Kong's Hang Seng Index (HSI) rose the most in a week on Tuesday after a report on the mainland's manufacturing eased concern its economy is slowing, and amid speculation the US Federal Reserve will announce more measures to support American economic recovery.

The HSI advanced 1.99 percent to 19875.53, its steepest gain since August 15. All but five stocks rose in the 46-member gauge. The Hang Seng China Enterprises Index rose 3.25 percent to 10578.96.

Jiangxi Copper rose 4.3 percent to HK$20.40. China Railway Construction Corp rose 3.3 percent to HK$3.77. Anhui Conch Cement Co jumped 5.2 percent to HK$31.20.

China's factory output may contract at a slower pace in August, according to a report on Tuesday by HSBC Holdings Plc and Markit Economics.

A preliminary reading of a manufacturing index by the companies rose to 49.8 this month from a final reading of 49.3 for July. While a number below 50 indicates a contraction, HSBC said that Tuesday's figure suggests last month's slide may have been a one-off "blip".

Li & Fung rose 3.3 percent to HK$13.24, while Techtronic Industries Co jumped 5.3 percent to HK$7.30. Central bankers from around the world will meet on August 26 at an annual conference in Jackson Hole, Wyoming. That's the same place where US Federal Reserve Chairman Ben Bernanke triggered a rally in equities last year when he said the Fed was prepared to "do all that it can" to ensure an economic recovery.

Cnooc rose 2.7 percent to HK$14.52. China Oilfield Services Ltd surged 7 percent to HK$11 after crude for October delivery climbed 1.9 percent on Tuesday.

Among stocks that fell, BYD Co retreated 14 percent to HK$16.18. The Chinese automaker part-owned by Warren Buffett's Berkshire Hathaway Inc said profit tumbled 89 percent in the first-half.

Futures on the HSI gained 1.9 percent to 19,851. The HSI Volatility Index rose 4.4 percent to 38.63.

Bloomberg - Reuters

(HK Edition 08/24/2011 page2)