Bloomberg News

Hong Kong Stocks Erase Losses as Banks Rebound, Utilities Climb

June 21, 2013

Hong Kong stocks erased declines after China’s benchmark money-market rates retreated from record highs, easing concern that China’s banks are facing a credit crunch. Utilities shares also advanced.

Galaxy Entertainment Group Ltd. (27) dropped 6.9 percent after JPMorgan Chase & Co. cut its recommendation on the the Macau casino operator founded by billionaire Lui Che Woo. Zijin Mining Group Co., China’s biggest gold miner by market value, sank 3.6 percent. Industrial & Commercial Bank of China Ltd. reversed losses to climb 1.5 percent, with the world’s biggest bank heading for its first gain this month.

“We see recent share price weakness as a buying opportunity” for lenders’ stocks, said Simon Ho, a Hong Kong-based analyst at Citigroup Inc. “Valuations have just fallen below the recent trough. Big banks have stronger capital and liquidity.”

The Hang Seng Index (HSI) slid 0.3 percent to 20,323.20 as of 2:41 p.m. in Hong Kong after erasing a 2 percent loss. The gauge is heading for a 3.1 percent slide this week, a sixth week of declines and the longest losing streak since October 2008. Three shares fell for each that rose, with volume nearly double the 30-day intraday average. The Hang Seng China Enterprises Index (HSCEI) added 0.2 percent to 9,281.82, reversing a 2.4 percent drop.

To contact the reporter on this story: Adam Haigh in Sydney at ahaigh1@bloomberg.net

To contact the editor responsible for this story: Nick Gentle at ngentle2@bloomberg.net


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