Hong Kong's key stock index rises as Chinese bank issues positive outlook for first half

Fri, Jul 4 04:02 PM

HONG KONG (AP) _ Hong Kong stocks advanced Friday, led partly by banks after China's biggest lender forecast a sharp rise in profits. The benchmark Hang Seng Index snapped two days of losses to end 181.04 points, or nearly 0.9 percent, higher at 21,423.82.

With stocks beaten down recently, some investors were returning to the market. Others who bet on falling prices were starting to take profits, further supporting prices.

"Investors are still bearish, we've been down a lot in the past few weeks. But even those bears are a bit hesitant on selling at this level," said Y.K. Chan, fund manager at Phillip Capital Management in Hong Kong.

The Industrial and Commercial Bank of China helped lift the market. The bank said its net profit could surge more than 50 percent in the first half compared to the year-ago period, thanks to higher interest and fee income as well as lower tax rates, Xinhua reported.

ICBC climbed 2 percent to HK$5.1. Standard Chartered was up 4.2 percent at HK$225.2.

Telecoms, seen by some analysts as a safer play during periods of high inflation, rose. China Netcom was up almost 4 percent and its suitor, China Unicom, gained 2.1 percent.

In other stocks, retail goods and textile exporter Li & Fung added 3.6 percent to HK$23. Ping An Insurance, China's second-largest insurance firm, recovered some of its heavy losses from Thursday to end 3.8 percent higher at HK$50.75.

___ On the Net: Stock Exchange of Hong Kong: http://www.hkex.

com.hk.

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