SYDNEY: Hong Kong stocks rose, with the benchmark index headed for its first increase in five days, after a report China will speed up approvals for infrastructure projects as the government pledges to boost economic growth.
Agricultural Bank of China Ltd. climbed 1%, leading bank shares higher. PetroChina Co. and Cnooc Ltd. paced gains among oil producers as crude rose for a second day. Ports Design Ltd. slumped 34% after Edward Tan resigned as executive director and chairman of the garment maker.
The Hang Seng Index climbed 0.7% to 19,047.83 as of 10:05 a.m. local time. The Hang Seng China Enterprises Index of mainland stocks advanced 1.1% to 9,688.45.
“We’ve turned quite a bit more optimistic on China in the last few months,” Arnout Van Rijn, chief investment officer for Robeco Groep NV’s Hong Kong division, said in a Bloomberg Television interview. The firm oversees $200 billion globally. “From here on you’ll get some better numbers” on the Chinese economy. “It’s quite safe to buy stocks.”
Concern that economic growth in China is slowing and a deepening debt crisis in Europe dragged down Hong Kong’s benchmark index by 13% from this year’s peak through yesterday. Shares on the index traded at 9.6 times estimated earnings on average as of yesterday, compared with a multiple of 12.5 on the Standard & Poor’s 500 Index, while the average on the Stoxx Europe 600 Index is 10 times.
China plans to speed up the approval of infrastructure construction projects to boost economic growth, China Securities Journal reported today, citing an unidentified person. The report follows weekend comments by Premier Wen Jiaboa that his government should adopt “proactive fiscal policy and a prudent monetary policy” to bolster the economy. (Bloomberg/T07)