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Hong Kong - Hong Kong shares traded higher on Thursday morning, supported by oil companies and steady gains in banks as earnings continued to be in focus.
The benchmark Hang Seng Index was up 0.76% by the midday trading break. CNOOC Ltd , China's top offshore oil producer, gained 2% after posting late on Wednesday its best-ever fourth-quarter profit, beating analyst forecasts.
"The company also warned of escalating costs, but it's an upstream producer, so should be less exposed than the other China oil companies," said Financial Group head of research Mark To.
Banks continued to do well, with China Construction Bank Corp , Industrial and Commercial Bank of China Ltd and Bank of China Ltd , expected to announce earnings later on Thursday, all gaining. Barclays Capital said it expected Chinese banks to achieve a 35% net profit growth on average.
Chinese cement producers outperformed. Anhui Conch Cement Co Ltd , up 5.3%, nearing an all-time high and China National Building Material Co Ltd up 5.1%.
"Cement prices are higher than previously expected, so stocks are now undervalued," said Andre Chang, an analyst with RBS in Taiwan. "We expect the rally to have at least 20% to 40% on the upside from here for the next three to six months," he said.
Petrochina offsets Shanghai property losses
The Shanghai Composite Index was up 0.1% by midday Thursday at 2 951.3 points, with profit-taking in property counters offset by a strong showing from China's largest listed company Petrochina Co Ltd.
The property sub-index was down 0.5 % in mild profit-taking after gaining 2.7% on Wednesday as the central government said it would reduce purchase and rental fees for affordable housing from May 1. The largest listed property company China Vanke Co Ltd was flat.
China property stocks were the cheapest mid-cap sector and remained the top sector pick in 2011, BNP Paribas Securities analyst Erwin Sanft wrote in a research note.
Petrochina firmed 1.9% after announcing that its first liquid natural gas terminal was slated to receive its initial cargo in April.
