(Corrects Xu’s title in fifth paragraph.)
Sohu.com Inc. (SOHU:US) jumped in New York on speculation it found a buyer for its search engine, while solar makers gained after a report that China won’t impose duties on polysilicon imported from Europe.
The Bloomberg China-US Equity Index of the most-traded Chinese stocks in the U.S. fell 0.1 percent to 84.35 yesterday. LDK Solar Co. rose and Yingli Green Energy Holding Co. (YGE:US), the world’s biggest solar panel maker, climbed to a 14-month high after Germany’s Handelsblatt reported China won’t impose import duties on European Union-produced polysilicon, a raw material for making panels. NQ (NQ:US) Mobile Inc. surged 6.7 percent and E-Commerce China Dangdang Inc. (DANG:US) slid.
Sohu rallied for a third day while Qihoo 360 Technology Co. (QIHU:US), owner of China’s second-biggest search engine, reached a record high after China’s Legal Evening News, in a report carried by news portal ifeng.com that cited unidentified people, said Qihoo will buy Sohu’s search unit as soon as this week. The companies didn’t respond to telephone calls and e-mails seeking comment.
“Gains in Sohu and Qihoo were probably stoked by the latest market discussions on their possible merger,” Echo He, an analyst at Maxim Group LLC in New York, said in a telephone interview. “Sohu is likely looking for a buyer.”
Jeff Bloker, Sohu’s U.S. media relations manager at Christensen Investor Relations Group, couldn’t comment before getting a response from Beijing-based Sohu. Alex Xu, Qihoo’s co-chief financial officer, didn’t immediately reply to an e-mail seeking comment after business hours in Beijing.
The iShares China Large-Cap ETF, the largest Chinese exchange-traded fund (FXI:US) in the U.S., advanced 0.4 percent to $32.21. The Standard & Poor’s 500 Index gained 0.5 percent to a three-week high as investors awaited the start of the second-quarter earnings season.
China’s statistics bureau is scheduled to release June data on inflation today. Consumer prices probably rose 2.5 percent last month, compared with a 2.1 percent gain in May, according to the median estimate of 40 economists in a Bloomberg survey.
Sohu, based in Beijing, advanced 3.5 percent to $66.4, the strongest close since June 19. Trading volume on Sohu shares was twice the daily average over the past three months, data compiled by Bloomberg showed. American depositary receipts of Qihoo rallied 2.5 percent to $49.52, the highest level since its initial public offering in March 2011.
Sohu’s Sogou search unit is talking with a few companies and the result is still confidential, according to the report on ifeng.com, which cited an unnamed person in Sogou’s marketing department.
Qihoo, which started a new search tool in August to compete with Baidu Inc., accounted for 15 percent of online searches in June, while Sohu’s portion was 8.8 percent, according to CNZZ, a Chinese Internet data provider.
“Qihoo doesn’t have enough cash for an all-cash deal, so most likely it will be a cash-plus-shares deal,” 86Research Ltd. wrote in a note yesterday. “The deal would be dilutive to Qihoo. On the deal announcement, investors should take profits on share pop-ups in Qihoo/Sogou, and buy Baidu shares on the dip.”
Baidu’s ADRs slid 1.1 percent to $90.50, after slumping 3.3 percent last week.
LDK, based in Xinyu, China, gained 2.9 percent to $1.42 in New York, the highest price since June 19. Baoding-based Yingli added 1.1 percent to $3.80, the highest level since May 1, 2012.
German polysilicon manufacturer Wacker Chemie AG (WCH) surged 6.7 percent in Frankfurt trading after Handelsblatt reported China’s decision on solar import duties. The EU imposed tariffs as high as 67.9 percent last month on solar panels from China in the largest EU commercial dispute of its kind, seeking to help revive a withering industry in Europe.
NQ, a mobile-security service company based in Beijing, advanced to $9.50, the highest level since May 15.
Shanda Games Ltd. (GAME:US), a Shanghai-based web game operator, climbed 3.6 percent to $4.03, the first gain in a week.
Actoz Soft Co. (052790), a South Korea-listed game company which is majority-owned by Shanda, has surged 44 percent over the past month.
Shanda Games “probably benefited from share price increases in Actoz, whose mobile games such as Million Arthur are doing well in Korea and Asia,” Andy Yeung, a New York-based analyst at Oppenheimer & Co, said by e-mail.
Dangdang’s ADRs slumped 3.4 percent to $6.75, the lowest level in two weeks.
The Hang Seng China Enterprises Index in Hong Kong slumped 1.6 percent to 9,063.30, after declining 1.1 percent last week, while the Shanghai Composite Index (SHCOMP) dropped 2.4 percent to 1,958.27, falling the most in two weeks.
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