December 1, 2010 (Chinavestor) Chinese stocks rose in Asia on Wednesday as strong manufacturing data mitigated effects of fiscal tightening. China’s Logistics Federation released the latest Purchasing Managers’ Index for November, indicating that manufacturing activity rose for the fourth straight month. Data suggests that the economy in China can withstand monetary tightening, a likely scenario for most of South-East Asia and India. The Hang Seng Index (INDEXHANGSENG:.HSI) rose 248.1 points or 1.0% while the Shanghai Composite Index (SHA:000001) eked out a small 3.3 points or 0.1% gain.
Yanzhou Coal (HKG:1171) (NYSE:YZC) was the best performing NYSE cross-listed component of the Hang Seng Index (INDEXHANGSENH:.HSI) with a 2.8% advance. But China Southern Airlines (HKG:1055) (NYSE:ZNH) succumbed to profit taking and fell 2.5%, the most among 42 components of the index. Investors were cautious in Shanghai, embracing the financial sectors after weeks of heavy sell-off. Industrial and Commercial Bank of China (SHA:601398) rose 2.1% just below that of Zijin Mining (SHA:601899), China's largest gold miner. Ping An Insurance (SHA:601318) fell 1.2%, the most among the 50 largest components of the Shanghai Composite Index (SHA:000001).
Most components of the iShares FTSE/Xinhua 25 Index (NYSE:FXI) advanced in Asia this morning, led by BOC Hong Kong and Air China. But Huaneng Power (HKG:0902) (NYSE:HNP), China's largest independent power producer fell for the fifth day in a row.
If components of the Hang Seng Index (INDEXHANGSENG:.HSI) can serve as proxy for Chinese ADR trading, outlook is best for Yanzhou Coal (NYSE:YZC) and China Life Insurance (NYSE:LFC), but Huaneng Power (NYSE:HNP) is expected to continue to suffer.