Hong Kong shares close at new record led by China stocks

They said Wall Street’s extended gains overnight also helped overall sentiment.

Property developer Chinese Estates surged after news that it is in talks with some parties regarding a buyout offer, while stock exchange operator HKEx was in focus on the back of robust trading activity in the market.

The Hang Seng Index closed up 67.41 points or 0.30 percent at 22,218.55, off a low of 22,131.24 and a new all-time high of 22,307.60.

The index’s previous closing high was 22,151.14, reached Tuesday, while its earlier all-time intraday high was 22,159.52, struck the same day.

Turnover was 83.43 billion Hong Kong dollars (10.7 billion US).

‘The market saw some weakness after (China’s) NBS issued a warning against the high level of fixed-asset investment in the mainland, which could mean adoption of more macro-economic tightening measures,’ said Matthew Kwok, head of research at Tanrich Securities.

‘However, investors chose to ignore the warning towards market close as they expect China companies to report an average 30 percent increase in profit in their earnings announcements next month,’ he added.

China’s Xinhua news agency cited the country’s National Bureau of Statistics (NBS) as saying that fixed-asset investments on the mainland grew by about 26 percent in the first half of the year, a rate too rapid to meet government targets to cool the economy.

Kwok noted that the sustained interest in H-shares comes as the yuan continues to appreciate against the US dollar, and amid expectations of further fund inflows into the local market following China’s expanded qualified domestic institutional investor (QDII) scheme.

China’s QDII program allows some mainland institutions to invest overseas.

‘The focus remains very much on China stocks, not on local blue chips which will probably see significant buying interest only after scores of them report mid-year results in the coming weeks,’ Kwok said.

China financials were mostly higher, with China Construction Bank gaining 0.14 at 5.61, ICBC up 0.03 at 4.48, China Life up 0.15 at 29, Ping An down 0.40 at 55.75 and Bank of China up 0.01 at 3.90.

The Hang Seng China Enterprises Index was up 67.63 points at 12,474.02.

China Mobile was down 0.20 at 86.60, HSBC down 0.20 at 143.20 and Hutchison Whampoa up 0.40 at 78.35.

HKEx was up 6.80 at 125.50, off a new all-time-high of 126.0, as the stock continues to get a boost from robust market activity.

‘For as long as market turnover averages at between 80 to 100 billion Hong Kong dollars, I expect this stock to continue posting new highs,’ said Kwok.

Cheung Kong was up 0.10 at 102.50, Sun Hung Kai Properties was down 0.35 at 94.15 and Henderson Land fell 0.10 to 53.15.

Local banks were mixed, with Hang Seng Bank up 0.90 at 107.80, Bank of East Asia flat at 44.45 and BOC Hong Kong up 0.06 at 18.88.