September 10, 2010 (Chinavestor) Despite a weak opening, key Chinese indices ended the day in the black in Asia. The Shanghai Composite Index (SHA:000001) eked out a gain of 6.9 points or 0.3 percent while the Hang Seng Index (INDEXHANGSENG:.HSI) rose 90.1 points or 0.4 percent to 21,257.39. Both key indices recoded gains for the second week in the row.
NYSE-HKEX cross listed blue chips were the most active components of the Hang Seng Index (INDEXHANGSENG:.HSI) on Friday. Airliners and China Mobile (HKG:0941) (NYSE:CHL) fell but energy and China Telecom (HKG0728) (NYSE:CHA) rose. Shares of China Eastern Airline (HKG:0670) (NYSE:CEA) tumbled 1.4 percent followed closely by China Southern Airlines (HKG:1055) (NYSE:ZNH). China's largest mobile phone company fell 1.2 percent. Yanzhou Coal (HKG:1171) (NYSE:YZC), the third largest coal miner in China, shed 1.0 percent. But offshore driller CNOOC Ltd. (HKG:0883)(NYSE:CEO) jumped 3.2 percent as oil prices firmed up while Huaneng Power International (HKG:0902) (NYSE:HNP), the largest Chinese independent power producer, advanced 1.1 percent.
Most of the gains are attributed to the return of confidence that China's economy will avoid a hard lending. Imports and exports for August rose to the second highest on record resulting in a trade surplus of over $20 billion. Another indicator of stong domestic consumtion is that auto sales rose three times as fast in August than in July, a strong bounce back from a slump a month earlier. Investor fear that the pickup may force the government to tighten the once red hot property sector, punishing real estate and construction related compenies the most.
Traders were focusing on curbs of the property sector in Shanghai, sending shares of Poly Real Estate (SHA:600048) 1.8 percent lower for the day or 5.2 percent for the week. Construction related Jiangxi Copper (SHA:600362), China's largest maker of the metal, fell 1.7 percent. China Vanke (SHE:200002), the largest listed property developer in China, tumbled 2.89 percent on Friday.Baoshan Iron and Steel (SHA:600019), the largest steel maker in China, fell 0.3 percent on Friday.
If performence of the components of the Hang Seng Index (INDEXHANGSENG:.HSI) are any good in predicting trading for NYSE listed companies, China Mobile (HKG:0941) (NYSE:CHL) and Chinese airlines are in trouble ahed the opening bell on Friday. But outlook is bright for CNOOC Ltd. (NYSE:CEO) and for Huaneng Power International (HKG:0902) (NYSE:HNP).