Dec. 16, 2009 (Chinavestor) China stocks fell in Shanghai and Hong Kong on Wednesday as financials weighted down U.S. and global equity markets. A strong IPO pipeline for the rest of 2009 hampers China stocks in Shanghai while Hong Kong is sensitive to American market sentiment. Stocks of interest for today include Yanzhou Coal (HKG:1171) (NYSE:YZC) and China Mobile (HKG:0941) (NYSE:CHL).
Profit taking dragged down Hong Kong's main index. The Hang Seng Index fell -202.18 points or -0.93% to 21,611.74 points at the close. Stocks that fell outnumbered those that advanced 10:1 out of the 44 member index. But Yanzhou Coal (HKG:1171) managed to eke out a gain while China Mobile (HKG:0941) traded sideways for most of the day and shed -0.1% only. This suggests a strong performance for both ADRs on the NYSE on Wednesday. But power companies and airliners weighted heavily on the index. Huaneng Power (HKG:0902) and Air China (HKG:0753) fell hard, along with the rest of the sector. Energy companies were weak as well.
Looking ahead the picture is much rosier. Index futures point to a higher open ahead the FED decision to leave interest rates unchanged. The dollar and treasuries are caught on fire as the bottom part of the chart suggests. The iShares FTSE/Xinhua China 25 Index (NYSE:FXI) and the Morgan Stanley China Fund (NYSE:CAF) have room to the upside. But don't expect much from the China Real Estate ETF (NYSE:TAO) in the short run.