Hong Kong stocks edged up 0.1 percent on Monday in their sixth straight gaining session as Hang Lung Properties and other real estate shares climbed on growing expectations that US interest rates would soon peak.
The city's top lender, HSBC Holdings Plc., closed up 0.21 percent at HK$140.10. After the market closed, HSBC posted an 18 percent rise in first-half profit, beating analysts' median forecast.
The benchmark Hang Seng index added 16.30 points to settle at 16,971.34, near the day's low and after trading above 17,000 in the morning. "Right now, the main theme of the market is the end of the interest rate cycle in the US If that theme continues, the market can hold above 16,700," said Linus Yip, strategist at First Shanghai Securities.
The latest data showed the US economy grew at a slower-than-expected pace in the second quarter, raising hopes that the Federal Reserve would soon pause its interest rate-raising campaign.
The improved rate outlook stoked demand for property shares, with Henderson Land rallying 2.2 percent to HK$42.60 and Hang Lung Properties jumping 2.4 percent to HK$15.34.
Landlord Hysan Development leapt 3.3 percent to HK$21.85 after Lehman Brothers issued an upbeat forecast on the company's interim earnings. The China Enterprises index of H-shares, or Hong Kong-listed shares in mainland companies, continued to trail the Hong Kong blue chips amid concerns that China would take further steps to curb the country's rapid investment.
The index ended down 0.43 percent at 6,829.49. "A slowdown in investment growth means a slowdown in China's overall economic growth rate and that will have a negative impact on corporate earnings," said Erwin Sanft, head of China Research at BNP Paribas.
Investors remained cool to mainland properties, with the country's top developer, China Overseas Land and Investment Ltd, down 2.6 percent at HK$4.55 in heavy trade. But Zijin Mining Co Ltd shot up 4.6 percent to HK$4.13 after J.P. Morgan said in a research note that the gold miner's acquisition of an 18 percent equity interest in the Hunchuan Zijin gold mines was positive and would increase the company's gold equity reserve by about 1.7 percent.
Ping An Insurance edged up 0.4 percent to HK$26.0, earlier setting fresh all-time highs, after China's number-two life insurer said it had agreed to buy a larger-than-expected 89.24 percent of Shenzhen Commercial Bank for $615 million, beating out rival local and foreign bidders. Turnover was HK$23.0 billion (US $2.9 billion) compared to Friday's HK$26.5 billion.