Hong Kong Stocks Fall; China Mobile, H Shares Pace Declines
By Yeong Choy Leng
Hong Kong, Feb. 21 (Bloomberg) -- Hong Kong stocks fell, led by China Mobile (Hong Kong) Ltd. after the U.S. Nasdaq Composite Index, from which local telecommunications and computer-related companies often take their lead, tumbled for a second day.
Adding to losses, PetroChina Co. and other Hong Kong-listed China H shares fell, reversing a 6.8 percent gain as a group in the past two days after investors rushed to buy the shares before new rules on stock ownership in the mainland become effective.
``The reaction was overdone,'' said Ben Kwong, a director at KGI Asia Ltd. ``We still have to look at the earnings fundamentals.''
The Hang Seng Index fell 175.85, or 1.1 percent, to 15,351.51. The Hang Seng Information Technology Index fell 3.4 percent while the Hang Seng China Enterprises Index, which tracks H shares, shed 4.5 percent. In the broader market, 306 stocks fell, 140 rose and 276 were unchanged. Trade at HK$11.4 billion ($1.5 billion) was a third more than the daily average for the past three months.
The following is a list of companies whose shares were active.
China stocks fell. China is allowing local investors to buy foreign currency-denominated B shares without restrictions, making China stocks in Hong Kong and overseas more attractive. China's state-controled, Hong Kong-listed companies, or H-shares, trade at an average of 11 times earnings, compared with 20 times for B shares and 63 times for local currency A shares.
PetroChina Co. (857 HK ), the listed unit of China's largest oil company, fell 5 cents, or 3.5 percent, to HK$1.38. Guangdong Kelon Electrical Holdings Co. (921 HK ), China's largest refrigerator maker, fell 20 cents, or 11 percent, to HK$1.67 after posting a record 42 percent gain yesterday. The company warned investors in December it will report a loss for 2000.
Telecommunications and computer stocks fell. The Nasdaq index shed 4.4 percent after analysts cut their estimates for JDS Uniphase Corp. and Applied Micro Circuits Corp. China Mobile (Hong Kong) Ltd. (941 HK ), China's No. 1 publicly traded mobile telephone company, fell HK$1.80, or 4 percent, to HK$43.70. Hutchison Whampoa Ltd. (13 HK ), which has global telecommunications businesses, fell HK$1, or 1.1 percent, to HK$94. QPL International Holdings Ltd. (243 HK ), an integrated circuit assembly company, fell 7.5 cents, or 1.7 percent, to HK$4.45.
Beijing Datang Power Generation Co. (991 HK ), one of China's biggest electricity generators, fell 52.5 cents, or 18 percent, to HK$2.275 after rising yesterday to its highest since Nov. 17, 1998. New World Infrastructure Ltd. (301 HK ), which operates roads and power plants in China, is selling its entire stake in Beijing Datang for $161 million, or at HK$2.55 each, an 8.9 percent discount to its Tuesday closing price, bankers involving in the sale said. NWI fell 40 cents, or 5.9 percent, to HK$6.40.
Cathay Pacific Airways (293 HK ), Hong Kong's only long-haul airline, rose 10 cents, or 0.8 percent, to HK$12. The company said it filled 59.2 percent of its available cargo capacity in January, 8.5 percentage points lower than a year earlier, as shipments fell during the Chinese New Year holiday. The stock fell 2.1 percent in the past four days.
China Eastern Airlines Corp. (670 HK ), the country's third-biggest airline, fell 5 cents, or 3.7 percent, to HK$1.30. The company will merge with Yunnan Airlines Co. in the government's latest step to unite the nation's fragmented airline industry into three main groups, a Yunnan official said. The move would expand China Eastern's fleet by about a quarter. The stock gained 11 percent in the past three months.
China Logistics Group Ltd. (217 HK ), which provides container transport and logistics services, fell 2.5 cents, or 11 percent, to 20.2 HK cents. The company said it is buying Shanghai Pudong CNCC Logistics Development Co. for HK$350 million ($44.8 million) to cope with an expected increase in foreign trade with the mainland. The stock surged 14 percent on Monday before it was suspended before the announcement.
China National Aviation Corp. (1110 HK ), a China- backed company that controls regional carrier Hong Kong Dragon Airlines Ltd., rose 2 cents, or 1.6 percent, to HK$1.26. A group led by CNAC and Jardine Matheson Holdings Ltd. was awarded a HK$530 million ($68 million) contract to build a logistics center at the Hong Kong airport. The stock rose 9.7 percent in the past three weeks.
Pacific Century CyberWorks Ltd. (8 HK ), Hong Kong's largest telecommunications company, extended yesterday's 4.8 percent loss, falling 5 cents, or 1.1 percent, to HK$4.375. Shareholder Cable & Wireless Plc said it hasn't found a buyer for its 14.9 percent CyberWorks stake yet, fueling concern it will be forced to sell its stake in the open market. Starting Feb. 17, Cable & Wireless was allowed to sell its CyberWorks stake as part of its agreement when it sold Cable & Wireless HKT Ltd. to CyberWorks.
Sinopec Zhenhai Refining & Chemical Co. (1128 HK ), China's second-largest refinery, fell 9 cents, or 6.9 percent, to HK$1.22. The company will start building a 450,000 tons-a-year petrochemical plant this year, to reduce its reliance on oil refining, an official said. ``The plant will provide a boost to the company's revenue and profit,'' said Leslie Chow, a chemicals analyst with Salomon Smith Barney in Hong Kong. The stock gained 13 percent in the past two days.
Tianjin Development Holdings Ltd. (882 HK ), which develops ports in the northern city of Tianjin among other businesses, was unchanged at HK$2.50 after rising as much as 5 percent. The company may invest more than 8 billion yuan ($966.5 million) in the largest logistics center in northern China, Ming Pao Daily reported, citing vice chairman Zhou Si Chun.
Wing Lung Bank Ltd. (96 HK ), a small Hong Kong bank, fell 20 cents, or 0.6 percent, to HK$33.60. The bank said 2000 net income rose 18 percent from a year earlier to HK$1.01 billion. The stock gained 16 percent in the past three months.
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