Hong Kong stocks rose for the third straight day on Wednesday, ending at a 10-week closing high, with mainland electronics retailers gaining after Gome Electrical Appliances agreed to buy rival China Paradise Electronics Retail for about $680 million.
The benchmark Hang Seng index added 33.38 points to 16,617.24, its highest close since May 12, with China Mobile edging up 0.3 percent to a five-year closing high. Turnover was HK$19.6 billion (US $2.5 billion) compared to HK$22.6 billion on Tuesday. "The index should not be too volatile this week," said Castor Pang, strategist at SHK Financial Group. "People are waiting for the futures expiry this Friday and HSBC earnings results next Monday."
China Paradise rocketed 11.2 percent to HK$2.28 and Gome, China's top electronics retailer, powered up 8.7 percent to HK$6.90 in a deal that could spur more consolidation in the sector. "This is good news for shareholders of China Paradise - they got an exit. The acquisition will reduce competitive pressures and improve the competitive landscape," said Joseph Lau, director at Tai Fook Asset Management.
Shares in AAC Acoustic Technologies Holdings Inc, a maker of acoustic-related products, slid 5.7 percent to HK$7.40 in active trade after two of its major shareholders were selling shares worth US $80-US $83 million on Tuesday at an offer price of HK$7.30-HK$7.60 each, according to a term sheet seen by Reuters.
Blue chip Li & Fung jumped 3 percent to HK$16.48, helped by an unexpected rise in consumer confidence in the US, one of the trading firm's key markets.
PCCW LTD., Hong Kong's main fixed-line phone carrier, shed 1.2 percent to HK$4.90 after saying on Tuesday it had decided to terminate talks with Macquarie Bank and TPG/Newbridge on the sale of its core phone and media assets.
The decision effectively closes the door on an opportunity that may have fetched greater value for shareholders than PCCW chairman Richard Li's share sale to financier Francis Leung.
China's biggest chip designer Solomon Systech (International) Ltd slumped 2 percent to HK$1.95 after BNP Paribas downgraded the stock's rating, saying early signs of a recovery have proven unsustainable.
Comments
Comments are closed.