Hong Kong stocks edged up 0.2 percent on Friday in their third straight record close as global lender HSBC reversed recent losses triggered by disappointing quarterly results from its US units this week.
Hong Kong-listed shares in mainland companies, or H shares, rose to their seventh straight record close, as investors bid up China Life after the insurer acquired a 20-percent stake in a protracted battle to win control of Guangdong Development Bank. But profit takers zeroed in on mainland lenders which had racked up a week of hefty gains, making them the biggest drag on the H shares.
The benchmark Hang Seng index added 28.64 points to end at 19,182.71, a gain of 1.5 percent for the week. The China Enterprises index of H shares edged up 0.1 percent to 8,321.33, marking a weekly gain of 5.1 percent, fuelled by sharp gains from mainland lenders.
Turnover was HK$50.8 billion (US $6.5 billion), down from Thursday's HK$57.5 billion. "There's abundant liquidity in the market and unstoppable demand for China shares," said Joseph Lau, director at Tai Fook Asset Management. "But the market has gone up so much and this will tempt investors to take profits."
"We believe earnings from the Chinese banks in the second-half and into the first-half next year will likely surprise on the upside and the sector will be the focus for some time to come." HSBC, the day's most active stock and blue chip leader, rose 0.4 percent to HK$147.10, ending five straight days of declines.
Top mainland life insurer China Life jumped 2.3 percent to HK$18.42, off a record set earlier in the day. Among mainland lenders, China Construction Bank dropped 1 percent to HK$4.07 and Bank of China fell 1.3 percent to HK$3.78.
Bank of Communications sank 2.2 percent to HK$7.18 as investors cashed in gains made from the lender's strong third-quarter results. China's fifth-largest bank posted a 40 percent rise in third-quarter net profit on Thursday, driven by strong loan growth in the mainland's thriving economy.
Li & Fung rose to a record for a third straight day before ending up 4.6 percent at HK$23.90. Investors speculated in shares of the exporter following comments by its president that the company would tap into its acquisition pipeline before year-end.
The stock, helped earlier in the week by stronger-than-expected results by its key customer WalMart, rose nearly 17 percent for the week. Asia's top oil refiner Sinopec Corp shot up 2.1 percent to HK$5.82, earlier touching a new high, as falling crude prices were seen boosting its margins.
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