The Hang Seng Index in Hong Kong edged up 0.2% in thin turnover to 22,667, the seventh year-best finish for the year since the index hit 22,271 on December 6. The index of Chinese companies rose 0.3% to 11,378. For the week, the Hang Seng climbed 0.7% and Chinese companies ended 1.3% higher.
With the Chinese economy recovering and hot money flowing into Hong Kong, the rally will probably continue in 2013, said Ben Kwong, chief operating officer at KGI Asia.
“However, as it is a liquidity driven rally, we expect the market to be volatile throughout the year," he told Equities in an email. "Investors should still keep a close eye on the market fund flow.”
Kwong's targets for 2013 are 23,500 in the first quarter, 24,000 for the first half of the year and 25,000 for all of 2013.
China’s push for urbanization will likely create winners among cement and other basic building materials producers and property developers in second and third-tier cities, he said. The drive will also raise average middle class incomes, benefitting the mass market consumption sector. End
Hong Kong Blue Chips: +47, +0.2, to 22,667, 12-28-12, Hang Seng Index
Chinese Stocks in Hong Kong: +30, +0.3, to 11,378, 12-28-12, HSCE Index
Shanghai Stocks: +27, +1.2% to 2,233, 12-28-12, Shanghai Composite Index.
Chinese Stocks in the U.S.: -0.4, 395.7, 12-27-12, Bank of New York Mellon, ADR Index-China - closed by storm
Insight: Hong Kong posted a small gain in quiet trading. With A-shares rising on the Mainland, Chinese brokerages surged: China Everbright Securities (CEVIY) rose more than 10%. KGI Research
Quotable: "HK market could probably maintain its upward momentum." BOCOM International.12-28-12
Chinese Company to Watch: "ChinaGas (HOKCY) - Downstream business will rapidly expand .... Gas supply covers nearly an urban population of 100 million. With over 50,000km high pressure and medium pressure grid and courtyard pipe network...." Phillip Securities. 12-28-12
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For a list of Chinese companies sold in the U.S. and information on each company go to http://www.adrbnymellon.com/dr_country_profile.jsp?country=CN
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