Hong Kong's main share index is expected to remain in a tight range this week, despite the lure of two market debutants, as investors wait for the first-half corporate earnings season.
The Hang Seng Index, which groups 33 blue-chip stocks, rose 0.68 percent to 12,202.26 on Friday, giving the index a slim 0.15 percent loss over the week. Despite a first-quarter rally, the Hang Seng is down 3 percent so far this year.
"I think we'll keep moving sideways. We're still waiting for some news flow," said Lau.
Dry bulk shipper Pacific Basin Shipping Ltd will list on Wednesday after raising US $140 million from an IPO that drew strong demand from institutional investors.
Garment maker Luen Thai Holdings Ltd debuts on Thursday after it raised HK$669.4 million (US $85.8 million) from an IPO priced at HK$2.975, near the high end of expectations, after drawing strong demand from individual investors.
"The market angel is Luen Thai. It was 250 times oversubscribed - I reckon it could go up 20 percent on its debut," said Herbert Lau, research director at Celestial Asia Securities, referring to the retail portion of the IPO.
Luen Thai, which makes clothes for Polo Ralph Lauren and Fast Retailing, is expected to benefit from the abolition of export quotas on textiles and clothing from China next year.
Investors also like its strategic partnership with Hong Kong blue-chip Yue Yuen Industrial Holdings Ltd, the world's largest shoe maker. Yue Yuen paid US $33.98 million for 9.9 percent of Luen Thai. The two companies have a 50/50 joint venture to make sportswear for Adidas-Salomon.
Pacific Basin, which ships bulk goods such as coal and steel, was priced at HK$2.50 and is expected to enjoy a steady rather than sizzling first-day showing.
Investors have been more cautious of late with China offerings, but some retail plays have found favour.
In June, sportswear firm Li Ning Co Ltd jumped 9 percent on its debut, while the larger Ping An Insurance was little changed. Both now trade slightly above their issue price.
Bank and financial stocks such as Bank of East Asia will be the first to report six-month earnings later this month.
The Hang Seng China Enterprise index, grouping 37 Chinese firms, or H shares, rose 0.34 percent to 4,315.30 on Friday.
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