China energy firms up but Shanghai, Hong Kong buck Asia rally
PetroChina, the biggest energy producer, would sell its stake
in a pipeline company for as much as $2.4b and transfer assets to boost the commercial business of its Kunlun Energy unit
AFP
AFP, HONG KONG: Chinese energy firms advanced yesterday following the latest moves to reform the countrys bloated state-owned enterprises, but the gains were unable to help Hong Kong and Shanghai keep up with an Asia-wide market rally.
Another broadly upbeat batch of data on the US economy provided some support on regional trading floors, while tensions over Turkeys shooting down of a Russian fighter jet also eased slightly.
PetroChina, the biggest energy producer, said it would sell its stake in a pipeline company for as much as $2.4 billion and transfer assets to boost the commercial business of its Kunlun Energy unit.
However, with afternoon bargain-buying kicking in on trading floors in Hong Kong and Shanghai, PetroChina pared the mornings big gains. It was up 0.4 per cent in Hong Kong but ended slightly lower in Shanghai.
Kunlun rallied more than three per cent in Hong Kong.
And Aluminum Corp. of China, known as Chalco, surged on both markets after it said it would also offload a stake in a Shanxi unit. Sinopec and China Shenhua also jumped.
The moves come as China looks to overhaul its bloated SOEs in a drive to make them more efficient as President Xi Jinping looks to reform the worlds number two economy, which is suffering a painful growth slowdown.
However, despite the early promise Shanghai ended lower after a two-day advance, with the energy rally unable to soothe investors ahead of Mondays restart of initial public offerings they fear will divert cash from existing stocks.
The regions other markets climbed, with Tokyo ending up 0.5 per cent, Seoul 1.1 per cent higher and Sydney adding 0.3 per cent.
Upbeat US figures lent support to buying, with falling jobless claims, an increase in durable goods orders and rising new home sales gaining, trumping a below-par hike in consumer spending.
US economic data was in line with expectations and provides some comfort, Mitsushige Akino, executive officer at Ichiyoshi Asset Management Co, told Bloomberg News. Investors expect markets will rise after the US rate hike since uncertainty will be dispelled.
The dollar strengthened against the euro as the data reinforced expectations the Federal Reserve will lift US interest rates next month, while the European Central Bank considers further easing measures ahead of its policy meeting next month.
The greenback also rose against most emerging market units after spending most of this week on the back foot.
While the Turkish downing this week of a Russian fighter jet continues to keep traders on edge, there were hopes a full-blown crisis will be avoided, with both sides stressing a desire to avoid a military escalation in the already volatile region.
Turkeys military said it did not know the warplane it shot down on the Syrian border was Russian, adding that it was ready for all kinds of cooperation.
In European trade yesterday London opened flat, Frankfurt added 0.1 per cent and Paris lost 0.2 per cent.
