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
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
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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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