Jan. 18 (Bloomberg) --Chinese stocks climbed in New York for the first time in three days, led by Qihoo 360 Technology Co. (QIHU:US), on prospects the nation will report that Asia’s biggest economy grew at a faster pace after a seven-quarter slowdown.
The Bloomberg China-US Equity Index (CH55BN) of the most-traded Chinese shares in the U.S. gained 0.1 percent to 101 yesterday. Guangshen Railway Co. (GSH:US) jumped the most in a month on a report China will boost investment in the sector. Software companies Qihoo 360 Technology Co. and AutoNavi Holdings Ltd. (AMAP:US) posted the biggest rally in two weeks. Melco Crown Entertainment Ltd. (6883) traded at a premium over its Hong Kong stock for a fourth day.
Societe Generale SA economists lifted yesterday their estimates for China’s economic growth rate before a scheduled release from the statistics bureau today. The world’s second- largest economy probably expanded 7.8 percent in the fourth quarter, according to the median estimate of 53 economists surveyed by Bloomberg. That’s up from a three-year low of 7.4 percent in the previous period.
“China’s main economic data should confirm the economy is recovering, and the market will continue to rise if they come out better than expected,” Michael Ding, the lead manager of the China Region Fund (USCOX:US) at U.S. Global Investors Inc., which oversees $2.2 billion, said yesterday from San Antonio, Texas. “Companies expecting quarterly losses may decline before their releases while investors wait for their earnings guidance for this year.”
The iShares FTSE China 25 Index Fund (FXI:US), the largest Chinese exchange-traded fund in the U.S., climbed 0.4 percent to $41.36, the first gain in three days. The Standard & Poor’s 500 Index (SPX) advanced 0.6 percent to 1,480.94 as data on U.S. initial jobless claims and housing starts beat economist estimates.
Societe Generale China economist Yao Wei raised his forecast for China’s fourth-quarter growth to 7.9 percent from 7.7 percent in a research note yesterday, also lifting his projection for 2013 to 7.8 percent from 7.4 percent. China’s December economic data including industrial production and fixed-asset investment are also due today.
American depositary receipts of Guangshen, which runs the only railroad line linking the mainland China with Hong Kong, climbed 3.4 percent to $21.07, the biggest rally since Dec. 10.
China plans railroad fixed-asset investment of 650 billion yuan ($105 billion) in 2013, the official Xinhua News Agency said yesterday on its microblog account with Sina Corp., citing Railway Minister Sheng Guangzu. The nation’s total railroad spending size reached 630 billion yuan last year after four increases since July. Xinhua said separately yesterday that China will set up a national railroad development fund “as soon as possible,” without providing details.
Melco Crown, which operates casinos in Macau, added 2.4 percent to $19.92, the highest close since Feb. 5, 2007. Its ADRs, each representing three underlying shares, traded with a premium over its Hong Kong shares for a fourth day, the longest stretch in four weeks.
Simon Cheung, a Hong Kong-based analyst at Goldman Sachs Group Inc., raised his price estimate for Melco’s ADRs to $23.5 from $21.5 on Jan. 16.
Qihoo, an Internet software developer based in Beijing, surged 4.4 percent to $31.83, the biggest advance in two weeks. AutoNavi, a Beijing-based company providing digital map content to such companies as Apple Inc. and Sina, climbed 3.4 percent to $11.79, the steepest rally since Jan. 2.
AutoNavi said in a Jan. 14 statement that users of its free mobile map application exceeded 100 million, joining five other Chinese software companies with more than 100 million users.
New Oriental Education & Technology Group Inc. (EDU:US), the biggest private educational service provider in China, dropped 3.9 percent to $18.38 in its second day of declines, posting the biggest slump since Dec. 5.
The company is scheduled to report earnings on Jan. 29 for the three months ended Nov. 30. The company may post its first quarterly loss since the three months ended May 31, 2007, data compiled by Bloomberg show.
Youku Tudou Inc., the biggest video website operator in China, declined for a third day, losing 1 percent to a one-week low of $21.75. The Beijing-based company may report a net loss (YOKU:US) of $119 million for the last quarter of 2012, according to the mean estimate of five analysts in a Bloomberg survey. Youku reported a net loss of $91.5 million for the previous three months.
The Hang Seng China Enterprises Index (HSCEI) lost 0.4 percent in its second day of declines to 11,858.21, while the Shanghai Composite Index (SHCOMP) of domestic Chinese shares dropped 1.1 percent to 2,284.91, the lowest level this week.
Twelve-month non-deliverable forwards on the yuan strengthened 0.14 percent to 6.2770 per dollar, rising for the first time in five days. The currency was little changed at 6.2160 per dollar in Shanghai yesterday, according to the China Foreign Exchange Trade system.
Ten-day volatility on the China-US gauge fell to 17 yesterday, the lowest level this year. The Bloomberg Chinese Reverse Mergers Index (CHINARTO), which tracks a basket of companies that gained U.S. listings after buying firms that already trade, advanced 0.5 percent to 79.08, the highest level since May.
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