Hong Kong Stocks Mixed; CLP, Other Utilities Gain as HSBC Falls
By Christina Soon
Hong Kong, Feb. 1 (Bloomberg) -- Hong Kong utility companies rose, led by CLP Holdings Ltd., as investors switched into stocks that offer steady earnings on concern the U.S. economic slide will lead to a global slowdown.
Limiting gains, HSBC Holdings Plc fell as investors bet a half-point interest rate cut by the U.S. Federal Reserve had been factored into share prices.
``The market has already built in its expectation of a 50 basis point cut,'' said Peter Chau, who helps manage about $1 billion in Asia at TAL CEF Global Asset Management Ltd. ``Interest rate sensitive stocks have already discounted the expectation.''
The Hang Seng Index rose 61.64, or 0.4 percent, to 16,163.99. The Hang Seng Utility Index rose 2.1 percent. In the broader index, 213 stocks rose, 191 stocks fell while 318 were unchanged. Trade at HK$9.5 billion ($1.2 billion) was almost the same as the daily average in the past three months.
A U.S. government report showed the economy expanded in the fourth quarter at the slowest pace in 5 1/2 years. The Fed reduced the target rate on overnight loans between banks to 5.5 percent, the second half-point cut this month.
The following is a list of companies whose shares were active.
Hong Kong stocks:
Utility stocks rose as investors switched into these stocks that offer steady earnings. CLP Holdings Ltd. (2 HK ), Hong Kong's biggest electricity company, rose HK$1.00, 2.8 percent, to HK$37.40. Hong Kong & China Gas Co. (3 HK ), a unit of Henderson Investment Ltd., rose 20 cents, or 1.8 percent, to HK$11.40. Hongkong Electric Holdings Ltd. (6 HK ), which supplies electricity to Hong Kong Island, gained 45 cents, or 1.6 percent, to HK$28.35.
``Such stocks are seen as a safe haven,'' said Edmund Cheung, an analyst at Core Pacific-Yamaichi International (H.K.) Ltd. ``With investors taking profit in some other stocks and utility stocks down so much, investors are buying them now.''
HSBC Holdings Plc (5 HK ), the U.K.-based parent of the city's two largest lenders, fell HK$1.50, or 1.2 percent, to HK$120. Some investors were disappointed by the expected half- point rate cut by the Federal Reserve, having anticipated a bigger reduction. A U.S. government report said consumer confidence tumbled in January more than in any other month since the last recession in 1990, fueling some expectations the Fed may cut rates by three-quarter-point yesterday.
China Foods Holdings Ltd. (506 HK ), controlled by China's largest trading company China National Cereals, Oils & Foodstuffs Import & Export Corp., or Cofco, fell 10 cents, or 5.8 percent, to HK$1.62. The company said it will pay HK$1.11 billion ($142 million) in new stock to its parent for edible oil and winery businesses. The purchase will make China Foods the largest edible oils producer in China and is part of Cofco's overall restructuring that will make China Foods its listed flagship in the food and beverage business, managing director Liu Fuchun said. The stock has risen 15 percent in the last two weeks.
E2-Capital Holdings Ltd. (378 HK ), an investment bank, rose 5 cents, or 12 percent, to 47 H.K. cents, its biggest one-day gain since Nov. 7. Softbank Investment International (Strategic) Ltd. (648 HK ), the Hong Kong-listed vehicle of Softbank Corp., Asia's largest Internet investor, said it will buy a stake in e2-Capital's financial unit. Softbank Investment fell 14 cents, or 12 percent, to HK$1.02.
I-Cable Communications Ltd. (1097 HK ), Hong Kong's only cable television operator, rose 27.5 cents, or 6.7 percent, to HK$4.40. The stock has fallen 11 percent in the past three days on concern it may lose the redistribution right of the English Premier League. Ming Pao Daily reported, citing unnamed U.K. newspapers, that the soccer program will be won by a consortium formed by Transworld International, Canal Plus and Fox Entertainment Group.
Industrial and Commercial Bank of China (Asia) Ltd. (349 HK ), the Hong Kong unit of China's biggest bank, rose 5 cents, or 0.8 percent, to HK$6.75. Parent Industrial and Commercial Bank of China will transfer its share of an investment banking joint venture with Bank of East Asia Ltd. into the Hong Kong unit, the Apple Daily reported, citing an unidentified source. ICBC wants to increase the size of ICBC (Asia) amid fierce competition in Hong Kong banking industry, the paper said.
Jiangxi Copper Co. (358 HK ), China's largest producer of the metal, rose 2 cents, or 2.9 percent, to 72 H.K. cents. The company said it plans to boost production by at least 10 percent this year as continued investment in power networks drives up demand and prices.
Pacific Century CyberWorks Ltd. (8 HK ), the third worst-performing stock within the top 60 stocks on the Hang Seng 100 Index last month, rose 15 cents, or 3.3 percent, to HK$4.675 as investors deemed its 10 percent loss last month as overdone.
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