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Hong Kong - Chinese stocks in Hong Kong rose, led by financial companies, as improving manufacturing data boosted confidence in the nation’s economy. Macau casino operators climbed after gambling revenue in the city increased.
The Hang Seng China Enterprises Index gained 0.7% at 07:07, erasing an earlier loss of 0.7%. China Merchants Bank rallied to the highest level since November.
The nation’s official factory gauge unexpectedly climbed last month to the highest level in almost two years. Galaxy Entertainment jumped the most since July after a slump in Macau’s gambling revenue came to an end in August. The Shanghai Composite Index fell 0.2%.
The manufacturing data extended a rally that made the H-share gauge the world’s best performer in August. Chinese stocks have come under pressure in recent days on concern the Federal Reserve will raise interest rates this year, boosting borrowing costs and weakening the yuan.
US jobs data due Friday could provide clues as to whether that policy tightening will come sooner rather than later, while investors are also awaiting the Group of 20 meeting in China this weekend.
“The PMI data were positive for China’s risky assets,” said Tim Condon, head of Asian research at ING Groep NV in Singapore. Even so, investors are “cautious about a September rate hike and tomorrow’s payrolls report could push the Fed to follow through.”
The Hang Seng China Enterprises Index rose to 9 605.08. The gauge’s 6.5% gain last month masked recent weakness, with the measure of Chinese companies traded in Hong Kong rising on only three of the previous 12 days. The Hang Seng Index added 0.8% as HSBC Holdings Plc advanced to the highest level since January.
China’s manufacturing purchasing managers index rose to 50.4 in August from July’s 49.9, beating the 49.8 median estimate of economists surveyed by Bloomberg. A PMI by Caixin Media and Markit Economics fell to 50 from 50.6 in July.
China Merchants Bank advanced 2.7%, extending a 14% rally in August, which was bolstered by higher first-half earnings. Bank of China added 1.7%, rising for a third day, as the lender reported a 3.4% increase in profit on Tuesday even after setting aside extra loan-loss provisions. HSBC added 3.4%, the biggest contributor to the Hang Seng Index’s gains by points.
Gaming stocks
Galaxy Entertainment and Sands China jumped at least 2.8% after Macau reversed its 26-month slump in gaming revenue as new resorts attracted visits by gamblers and tourists. The industry’s gross gaming revenue rose 1.1% in August from a year ago, beating the median estimate of a 1.5% drop in a Bloomberg survey.
China Gas Holdings sank 8.7% after the National Development and Reform Commission said it will strengthen supervision of natural gas distribution prices.
The Shanghai Composite hasn’t moved more than 1 percent on a closing basis for more than two weeks, a far cry from the first half of the year when 2% daily swings were regular occurrences.
