Bloomberg News

China’s Stock-Index Futures Climb After Benchmark Gauge Rallies

January 28, 2014

China’s stock-index futures rose before the release of a private report for manufacturing tomorrow.

Seven companies including Porton Fine Chemicals Ltd. and Netposa Technologies Ltd. (300367) will debut on the Shenzhen Stock Exchange today. Datong Coal Industry Co. (601001) may decline after forecasting a loss for last year.

Futures on the CSI 300 Index (SHSZ300) expiring in February added 0.5 percent to 2,241.8 at 9:28 a.m. local time. The Shanghai Composite Index (SHCOMP) climbed 0.3 percent to 2,038.51 yesterday, paring this year’s loss to 3.7 percent. China’s markets will be shut from Jan. 31 to Feb. 6 for the Chinese New Year holidays.

The CSI 300 Index rose 0.2 percent to 2,219.85 yesterday. The Hang Seng China Enterprises Index (HSCEI) retreated 0.3 percent. The Bloomberg China-US Equity Index, the measure of the most-traded U.S.-listed Chinese companies, added 1.5 percent in New York as Baidu (BIDU:US) Inc. jumped.

HSBC Holdings Plc and Markit Economics are due to release the January manufacturing Purchasing Managers’ Index tomorrow. Its preliminary reading was 49.6, according to data released last week, signaling the first contraction in six months. A number above 50 indicates expansion.

An official PMI by the nation’s statistics bureau is due Feb. 1.

IPO Reform

Since the China Securities Regulatory Commission ended a more than year-long freeze on initial public offerings, 36 companies have listed shares in the Shanghai and Shenzhen exchanges. So far, the securities regulator has approved 52 companies for IPO sales.

The securities regulator will “proactively” move ahead with market-oriented IPO reform in the “proper way,” CSRC Chairman Xiao Gang said at a meeting on Jan. 27, according to a statement on the regulator’s website.

Datong Coal may be active. The company estimated a loss of between 1.35 billion yuan ($223.1 million) and 1.45 billion yuan for 2013 because of lower thermal coal prices, declining sales, higher transportation fee and lower production, according to a statement to the exchange.

The Shanghai index is valued at 7.6 times 12-month projected earnings after reaching the cheapest level on record last week, data compiled by Bloomberg show. Trading volumes in the index were 5.4 percent lower than the 30-day average yesterday, according to data compiled by Bloomberg.

Chinese stocks trading in New York rebounded yesterday as an accord between U.S. regulators and Deloitte Touche Tohmatsu CPA Ltd. damped concern that a ban on the Asian nation’s accounting firms would delay earnings reports.

Deloitte Touche Tohmatsu and the Securities & Exchange Commission agreed to end a lawsuit related to the China-based firm’s audits of Longtop Financial Technologies Ltd, according to a Jan. 27 filing.

Baidu, China’s biggest web search engine, rose the most in a month and online bookseller E-Commerce China Dangdang Inc. jumped 8.7 percent. TAL Education Group surged 15 percent, the most since 2011.

To contact Bloomberg News staff for this story: Zhang Shidong in Shanghai at szhang5@bloomberg.net

To contact the editor responsible for this story: Michael Patterson at mpatterson10@bloomberg.net


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