Market Focus
US Market - Wall Street was closed last night for Thanksgiving. HK Market -The HK stock market retreated yesterday, led by mainland banks and lethargic mainland stock markets. The HS Index opened 31 points lower and then continued to slide. The drop onceexpanded to 503 points in late afternoon but narrowed to 401 points at close. The HS Index finished the day at 22210, down 1.8% with a turnover of HK$77.25bn. The HS China Enterprise Index also fell 299 points or 2.2% to 13146. Mainland banks were amongstthe worst performers yesterday although some mainland insurance counters outperformed. Bank of East Asia (0023) leapt 4% on a large broker’s recommendation. New bank stock China Minsheng Banking Corp (1988) finished at HK$8.80, down HK$0.28 or 3.08% from its listing price of HK$9.08. Other outperformers included China Travel (0308), up nearly 17% to HK$2.09 and Shanghai Jin Jiang Int’l Hotel (2006), up 5% to HK$2.49, after the PRC State Council approved faster development of tourism. HS index futures fell 423 points to 22177, 33 points below spot. Mainland stock market performance was overshadowed by concerns on whether banks need to raise huge amount of funds for capital fortification while investors took a cautious approach ahead of the Central Economic Work Conference. The Shanghai Composite fell 3.62% to 3170.9. Dubai proposed to restructure the US$59bn (HK$460.2bn) debt of Dubai World, its flagship business fund and to delay debt repayment. The market feared that it would turn into another big sovereign default since Argentina in 2001 and set back the global economic recovery path. European markets tumbled last night and the stock prices of alleged creditors HSBC 0005) and Standard Chartered (0888) fell 4.8% and 5.8% respectively in London. The Dubai woes, mainland banks’ fund-raising uncertainties and index settlement will all add weight to the HK bourse today.
News Flash
Coating products power Yip's -Yip's Chemical (0408) said net profit grew 44% to HK$228m for the six months ended September 30, as demand for its coating products increased. An interim dividend of 12 HK cents/share was declared, up 50% YoY. It said the dividend payout ratio for its 40th anniversary in 2011 would be higher than the current average of 40-60%. Turnover fell 13% to HK$2.7bn,due to a general decline in unit selling prices, although sales volume actually grew 12%. Gross margin rose 9% to 25% in the first half. The company’s 120,000-tonne acetate solvents production facility in Taixing will be completed by the end of the year, taking total capacity to 430,000 tons and making the company the world's largest acetate solvents producer.
