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HONG KONG (Nikkei Markets) – Hong Kong stocks moved higher on Friday after Friday's Wall Street advances, while investors were considering revising US Federal Reserve policy and future Sino-US trade talks.
The Hang Seng index rose 0.4% to 27,684.23 at noon, after a fourth consecutive weekly advance on Friday. Tencent Holdings rose 1%, extending Friday's gains after two of its games appear on a list of titles approved by China last week. China Petroleum & Chemical (Sinopec) added 2.1% after its interim net profit for 2018 rose 22% from a year ago.
Shares of the Industrial and Commercial Bank of China rose 0.2%. The lender said Sunday that Yi Huiman had resigned as president. Yi has been named chairman of the Securities Regulatory Commission of China, according to Xinhua.
The three leading Wall Street indexes finished higher on Friday after Washington agreed to temporarily end a 35-day US government shutdown. Markets continue to follow the evolution of Sino-US trade relations. Chinese Vice Premier Liu He is scheduled to meet with US Trade Representative Robert Lighthizer in Washington this week.
The Hong Kong stock market "is currently planning a favorable outcome for the trade negotiations, so any deviation from this perception will result in a strong market reaction," said Irene Chow, chief badyst of China and Hong Kong shares to Julius Baer .
The Hang Seng index has risen more than 7% so far in January.
Markets are also waiting for the first review of US Federal Reserve policy in 2019, with a two-day meeting starting on Tuesday. The central bank, which raised rates four times last year, said it would be patient with future interest rate increases.
"This week will be a key test of whether this momentum (for global equities) can be maintained," said Tai Hui, chief markets strategist for Asia-Pacific at JP Morgan Asset Management. "We think the Fed may seem more accommodative and more in line with market expectations of a limited rate hike margin this year, and a more accommodating Fed and steady progress in the US. Trade negotiations will be essential to maintain the positive sentiment of the market as Asia slows down to enter the Lunar New Year. "
On the continent, the Shanghai Composite rose 0.3%, while the foreign-traded yuan rose 0.3% against the dollar to 6.7279. Continental markets will be closed from February 4th to 8th for Lunar New Year holidays, while Hong Kong's financial markets will be closed from February 5th to 7th.
Russia's largest aluminum company, United Company Rusal, advanced 4.7 percent in Hong Kong after the US Treasury Department lifted the sanctions on the company and its largest shareholder, the En + group. The company also announced that an exchange agreement with commodity trader Glencore, suspended after the United States imposed sanctions on Rusal and En + in April, would proceed as planned.
The holdings of the rare earth magnesium technology group increased by 7%. The company announced Monday that it was expecting a significant increase in profits for 2018 compared to last year.
Great Wall Motor dropped 1.1%, bringing back 22% of gains up here this month. On Friday, the automaker announced a 6.5% increase in its preliminary net profit for 2018, even as total operating revenue declined 1.7%.
Future badets related to land use decreased by 3.6%. The developer said that he expects net profit for 2018 to have risen at least 40% over last year. In 2017, Future Land's profit almost tripled to 3.79 billion yuan ($ 563.3 million).
The Hong Kong International Construction Investment Management Group, a subsidiary of the Chinese group HNA, added 0.8% after stating that it was currently in talks with a potential buyer for the sale of Hong Kong. 39, a land at Kai Tak, Hong Kong.
The Century Sunshine Group Holdings fertilizer manufacturer grew 9.2%, after announcing a "significant" increase in the group's profit for 2018 compared with the previous year.
– Amy Lam
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