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China stocks rebound, Hong Kong slips under profit-taking pressure
January 12, 2017 / 5:32 AM / 8 months ago

China stocks rebound, Hong Kong slips under profit-taking pressure

* SSEC +0.2 pct, CSI300 +0.2 pct, HSI -0.3 pct

* Mainland energy sector broadly higher

SHANGHAI, Jan 12 (Reuters) - China stocks ticked up on Thursday morning bolstered by energy majors, while Hong Kong’s main index eased off one-month highs on profit-selling pressure after a strong start to the year.

Both mainland benchmarks, the CSI300 index and the Shanghai Composite Index, gained 0.2 percent by the lunch break, to 3,341.80 points and 3,143.06 points, respectively.

China stocks rebounded in thin trading amid mixed signals over the economy and renewed talk about ongoing reforms at some state-owned enterprises.

Government officials say China’s economy has been generally stable at the start of the year, continuing the momentum from second-half 2016, but also noting the economy faces a challenging and complicated trade outlook for 2017.

Pan Shaochang, an analyst at Dongguan Securities, identified two major sources of risks to investors: seasonal liquidity stress ahead of the Lunar New Year later this month and expectations for further yuan depreciation.

Most sectors advanced modestly in China, but an index tracking resource stocks corrected after hitting a nearly one-month intraday high set the previous session.

Shares of Metallurgical Corporation of China Ltd added nearly 5.9 percent on a news report that it would become the first firm to benefit from state-owned enterprises’ reform fund.

Energy firms PetroChina and China Petroleum & Chemical Corp gained.

In Hong Kong, the Hang Seng index threatened to snap a five-day winning streak, down 0.3 percent at 22,872.40 points, while the Hong Kong China Enterprises Index was unchanged at 9,734.81 points.

“No need to be too nervous about falls within 100 points. The market is generally steady today,” said Alex Wong, a director at Ample Finance Group.

A rise in profit-taking pressures after five days of gains countered optimism that tariffs against Chinese exports were not mentioned in a news conference held by U.S. President-elect Donald Trump.

Shares of China South City Holdings Ltd added around 5.5 percent after it said Shenzhen Centralcon Investment Holding Co would buy 23.2 percent of the company for $490 million.

Reporting by Jackie Cai and John Ruwitch; Editing by Jacqueline Wong

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