* HSI, H-shares +0.7 pct; CSI300 -0.5 pct
* Sinopec climbs on rising oil prices, Citi upgrade
* China consumer sector weak; Parkson, Tingyi earnings
* Ping An Insurance slides, HSBC confirms in talks to sell
By Clement Tan
HONG KONG, Nov 19 Hong Kong shares rose on
Monday, led by Chinese energy majors as higher oil prices and
Kunlun Energy's surprise inclusion as the 50th Hang Seng Index
component helped buoy interest in riskier counters.
The Chinese consumer sector was a key underperformer,
however, with department store operator Parkson Group
sliding 3.4 percent after it posted underwhelming third quarter
net profit late last Friday that also included negative same
The Hang Seng Index was up 0.7 percent at midday, set
for a second daily gain and furthering a bounce from a one-month
closing low seen last Thursday. The China Enterprises Index
of the top Chinese listings in Hong Kong also rose 0.7
On the mainland, the CSI300 Index of the top
Shanghai and Shenzhen listings slipped 0.5 percent, while the
Shanghai Composite Index shed 0.3 percent but held above
the 2,000 point-level.
"Higher oil prices is one factor today, but most of the
money today is short term, I don't think many will want to come
into the market at this point with so much uncertainty this
week," said Jackson Wong, Tanrich Securities' vice-president for
Talks to avert a fiscal crisis in the United States and a
meeting of European policymakers discussing more aid for Greece
are among key events that could drive market volatility in the
Consequently, turnover in Hong Kong at midday on Monday was
the lowest in almost a month, while Shanghai volume at midday
neared 2012 lows.
Shares of China Petroleum and Chemical Corp (Sinopec)
climbed 2.2 percent in Hong Kong, also helped by a
Citi upgrade from "neutral" to "buy" on an improvement in its
domestic refining margins that could aid an earnings recovery in
Chinese natural gas provider Kunlun Energy jumped
4.3 percent, touching a record high in early trade, after the
Hang Seng Index manager said the Chinese energy firm will become
the 50th component of the benchmark index from Dec. 10.
CHINA CONSUMER SECTOR WEAK
Bucking broader strength on the day, Chinese consumer
counters were hit by negative same store sales growth for
Parkson Group, raising fears that the slowdown in the Chinese
economy is hitting the sector more than expected.
In a report on Monday, UBS analysts said Parkson's 42.3
percent year-on-year decline in third-quarter earnings was a
result of slowing sales compounded by an acceleration in store
expansion that led to a sharp increase in related expenses.
"As more department stores report negative SSS, we believe
the sector valuation will be at much lower levels when negative
operating leverage emerges," they said in the same report dated
Nov 16, referring to same store sales.
Weakness in the sector also extended to rival retailers seen
adapting more effectively to the slowdown in the world's
second-largest economy. Golden Eagle shed 2.3 percent.
China's largest instant noodle producer Tingyi Holdings'
posted third quarter net profit at midday that
underwhelmed expectations and could compound weakness in the
sector when trading resumes after lunch.
Tingyi shares were up 1.7 percent at midday in Hong Kong.
Other key underperformers include Ping An Insurance
, which fell 2.7 percent in Hong Kong after a media
report said HSBC Holdings PLC is planning to sell its
$9.3 billion stake in China's No.2 insurer.
At the midday break, HSBC Holdings confirmed it
was in talks to sell its 15.57 percent stake in Ping An
Insurance. HSBC's shares rose 1.4 percent.
Ping An Insurance was down 0.9 percent in
Shanghai, setting mainland markets on the way to a
Chinese property developers also were weaker after data
showing housing prices rising 0.1 percent last month reignited
fears that more government curbs could be introduced on the
sector to dampen prices. Poly Real Estate slipped
Chinese premium alcohol producers Wuliangye and
Kweichow Moutai declined 3.7 and 2.9 percent,
respectively, on fears that their increased advertising
expenditure could crimp margins if demand declines as Beijing
crack down on corruption.
Chinese media reported that Wuliangye bought 499 million
yuan and Moutai 352 million yuan worth of advertisement slots on
CCTV evening news programming in 2013.
China's state television said it sold 15.8 billion yuan
($2.5 billion) of advertising spots for next year, the most in
19 years and up nearly 11 percent from a year earlier, amid
expectations that the economy would quicken its recovery in