Hong Kong-listed China plays advanced 0.8 percent on Thursday, as coal plays surged to records amid a favourable outlook for prices of the black carbon. China Construction Bank Corp, buoyed by the prospect of its Shanghai listing, led the blue chips up 0.2 percent.
The debut by Centron Telecom International Holding Ltd, a Chinese provider of technology for wireless network coverage, met expectations but some disappointment surfaced, following the stellar reception for China High Speed Transmission Equipment a day earlier.
The market fell in the afternoon following heavy losses on mainland bourses, but regained steam as it neared the close. Hong Kong, on a decoupling trend from the mainland market, is set to benefit from the mainland expanding Qualified Domestic Institutional Investor programme allowing domestic investors to plough their money into overseas securities.
The market set its third straight high, with the benchmark Hang Seng Index striking a new peak at 22,328.61 before closing up 34.44 points at 22,252.99, eclipsing Tuesday's record close.
The China Enterprises Index of mainland companies listed in Hong Kong gained 104.24 points to end at a closing high of 12,578.26, having earlier tapped a record 12,673.63. "There will still be some profit-taking pressure in the near-term, but investors remain positive," said Ben Kwong, chief operating officer at KGI Asia. "The uptrend will remain intact if we stay above 21,900." The market's 10-day moving average is about 21,960.
Mainboard turnover was the sixth-highest ever at HK$85.1 billion (US $10.9 billion). Coal concept plays hit new highs in heavy trade following a spate of broker price target upgrades. UBS and Deutsche Bank both raised China Shenhua Energy's share price target, sending the stock rallying as much as 7 percent before ending at HK$30.2 for a 5.6 percent gain.
UBS also raised Yanzhou Coal's price target to HK$16.51 from HK$13.11. Yanzhou Coal jumped 8.4 percent to close at HK$13.44. UBS projected China spot coal prices would rise 8 percent year-on-year in 2007 and 5 percent in 2008. China Coal shot up 8.5 percent to HK$13.84.
Commodity supplier CITIC Resources Holdings Ltd soared nearly 11 percent to HK$5.82 after its subsidiary, CITIC Resources Australia Pty Ltd, raised its stake in Australian miner Macarthur Coal Ltd to 19.9 percent. China Construction Bank, the biggest lift to the blue chips, raced up nearly 3 percent to HK$5.77, having earlier set its second straight peak.
Centron Telecom finished at HK$3.81, or 7.3 percent higher than its IPO price. It had traded between HK$3.78 and HK$4.40 following its US $108 million initial public offering.
Wind power transmission gear maker and newcomer China High Speed Transmission notched a further 6.3 percent gain to close at HK$14.88. Hong Kong Exchanges and Clearing nailed its sixth straight gain and its third successive peak on near record turnover. Shares in the city's bourse operator rose 1.7 percent to HK$127.60.