Hong Kong Stocks Rise

Hong Kong stocks rose a second day, with the benchmark index headed for its highest close in six years, as investors weighed earnings reports and amid signs of possible de-escalation in global conflicts.

China Resources Power Holdings Co. led gains after net income rose. Casino operator Galaxy Entertainment Group Ltd. climbed 0.7 percent before posting results today. Cheung Kong Holdings Ltd. added 1.1 percent to pace a gain by developers. Cnooc Ltd. increased 0.9 percent after the oil explorer was upgraded at Credit Suisse Group AG. China Medical System Holdings Ltd. surged to a record after posting a gain in profit.

The Hang Seng Index rose 0.2 percent to 25,010.27 as of 9:52 a.m. in Hong Kong, poised for the highest close since May 22, 2008. The Hang Seng China Enterprises Index (HSCEI), also known as the H-share index, added 0.4 percent to 11,112.47. Data yesterday showed U.S. homebuilder sentiment rose in August, as Federal Reserve Chair Janet Yellen and central bankers prepare to meet in Jackson Hole, Wyoming.

“Today is driven by geopolitical risks seen as easing and good U.S. economic data ahead of Yellen’s speech at Jackson Hole,” said Stuart Beavis, head of institutional equity derivatives at Vantage Capital in Hong Kong. “I am a hint wary that markets are too calm and that they are too dismissive of the end of or calming of geopolitical risk. It’s definitely not over yet and should still be followed closely.”

The H-share gauge rose 20 percent from this year’s low in March through yesterday amid speculation China will add stimulus to meet its growth goal. The index traded at 7.7 times estimated earnings at the last close, compared with 11.5 for the Hang Seng Index (HSI) and 16.5 on the Standard & Poor’s 500 Index (SPX) yesterday.

U.S. Futures

Futures on the S&P 500 climbed 0.1 percent today. The U.S. equity benchmark index increased 0.9 percent yesterday, while the Nasdaq Composite Index jumped 1 percent to the highest level since 2000. A gauge of confidence in the U.S. housing industry climbed to the highest level in seven months

Israel and Palestinian militants agreed to extend their five-day truce by 24 hours. In Iraq, Kurdish and government forces retook the nation’s largest dam from rebels. The Red Cross is close to working out details of a safe-passage plan for a Russian aid convoy intended for southeastern Ukraine. Ukrainian Foreign Minister Pavlo Klimkin met Russian counterpart Sergei Lavrov for more than five hours of talks in Berlin as they sought to ease tensions.

Source: bloomberg.com