Hong Kong, Shanghai Rally Further As Real Estate, Financials Rise

Hong Kong and Shanghai stocks made strong advances early Wednesday, as financials enjoyed a second day of solid gains amid reported expectations for further monetary easing and moves to bolster the sector. In initial moves, Hong Kong's Hang Seng Index rose 1%, while among the mainland China indexes, the Shanghai Composite added 1.3%, and Hong Kong's H-share index rose 2.1%. Hong Kong-traded financial shares were among the winners, as Haitong Securities Co. jumped 3.8%, Agricultural Bank of China Ltd. gained 2.2%, China Everbright Ltd. added 4.1%, and Bank of Communications Co. moved 3% higher. It was the second day the financials had helped drive Chinese markets higher, as the Hang Seng Index had risen 1.2% the previous day, with the Shanghai Composite rallying 3.1%. Also likely supporting sentiment Wednesday, The Wall Street Journal reported that Chinese nuclear-power producer CGN Power Co. had priced its Hong Kong initial public offering at the top end of its price range, with the shares set to debut Dec. 10. But an even stronger performance came from some of the mainland-China real-estate names, with China Overseas Land & Investment Ltd. up 4.5%, and China Resources Land Ltd. up 4.2%. Another Hang Seng component on the move was Cathay Pacific Airways Ltd. , improving by 2.9% on a further drop for oil prices. On the downside, Tencent Holdings Ltd. lost 0.4% as the official Xinhua News Agency quoted the Ministry of Culture as saying the company would be among those fined for charges of allowing pornography and gambling over the Internet.