China Stocks Resume Rally

Gene Linn |

It’s hard to keep a good market down. China stocks showed scant fiscal cliff angst Monday, edging slightly higher in half-day holiday trading in Hong Kong.
The Hang Seng Index retreated last Friday after the failure of Republican “Plan B” to avoid huge tax increases in the U.S., but rose 0.2% Monday to 22,542. The index of Chinese companies gained 0.4% to 11,271.
Optimism about a rebounding Chinese economy and a steady inflow of funds from overseas have helped push the Hang Seng up 3.4% since December 5 and 17.7% since September 5.
The Stock Exchange of Hong Kong will close Tuesday and Wednesday for the Christmas holiday. The rest of the shortened week should be quiet, according to Jackson Wong, vice president of sales for Tanrich Securities.
End-of-year window dressing may help some lagging stocks. “I like the second tier Chinese property stocks because they fit in the above theme,” Wong said. “Poly HK (119, HK) is a good example.”
Chinese telecom and shale gas producers should also fare well, he said. End
DAILY FIX

Hong Kong Blue Chips: +35, +0.2, to 22,542, 12-21-12, Hang Seng Index

Chinese Stocks in Hong Kong: +42, +0.4, to 11,271, 12-21-12, HSCE Index

Shanghai Stocks: +6, +0.3% to 2,159, 12-21-12, Shanghai Composite Index.

Chinese Stocks in the U.S.: +2.4, 398.3, 12-20-12, Bank of New York Mellon, ADR Index-China - closed by storm

Insight: Hong Kong edged higher in half-day holiday trading, feeling little effect from fiscal cliff worries in the U.S. Chinese insurance companies rose after the pension fund in wealthy Guangdong Province signaled it would invest in Mainland A-shares: CPIC (2601, HK) +2.0%. KGI Research

Quotable: "Driven by strong inflow of hot money as well as window dressing effect, the benchmark index will likely continue its upward trend and test 23,000 points. On the other hand, turnover is expected to be light due to Christmas holidays next week." BEA Securities. 12-21-12

Chinese Company to Watch: GUANGSHEN RAIL (GSH) "With steady income from Railway operation, current price is trading at perspective P/E of only 12.1 times with over 4% dividend yield; the counter is a defensive play." KGI Asia. 12-21-12

Brokerages and analysts cited here have disclaimers on their websites emphasizing their statements are for information only. They do not endorse my blog, and I don’t endorse them.

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

DISCLOSURE: The views and opinions expressed in this article are those of the authors, and do not represent the views of equities.com. Readers should not consider statements made by the author as formal recommendations and should consult their financial advisor before making any investment decisions. To read our full disclosure, please go to: http://www.equities.com/disclaimer

Companies

Symbol Name Price Change % Volume
NAV.P.D Navistar International Corporation Preferred Stock 11.21 0.00 0.00 0

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