* HSI -0.1 pct, H-shares +0.2 pct, CSI +0.6 pct
* HK turnover at to 2013 low, Shanghai volume improves
* China shipping rise after CSCL says 2012 profit expected
* ZTE sinks in Hong Kong after warning of 2012 loss
By Clement Tan
HONG KONG, Jan 21 China shares climbed to
another 7-1/2 month closing high on Monday, limiting Hong Kong
losses, with the shipping sector strong after China Shipping
Container Lines reported it expects a profit for 2012.
The Hang Seng Index closed down 0.1 percent at
23,590.9 after hitting on Friday its highest since June 1, 2011.
The China Enterprises Index of the top Chinese listings
in Hong Kong inched up 0.1 percent,
In the mainland, the Shanghai Composite Index rose
0.5 percent, while the CSI300 of the top Shanghai and
Shenzhen A-share listings gained 0.6 percent to their respective
highest since June 1, 2012.
Shanghai volume improved for a second-straight session, but
was still some way off the year's highs. Hong Kong turnover was
the lowest in 2013.
In Hong Kong, investors accelerated their switch away from
Chinese railway stocks, some of which suffered a fourth straight
loss on Monday.
"Chinese railway stocks were still weak today, there seems
to be some mild rotation into the shipping sector today, but
this could be short lived," said Edward Huang, equity strategist
at Haitong International Securities.
"I still think Chinese airlines may be a better sector
cyclical sector to rotate into, given the Chinese New Year peak
season is round the corner. I don't think this is a good entry
point for the shipping sector," Huang added.
The Chinese shipping sector was lifted on Monday after China
Shipping Container Lines (CSCL) said on
Friday that it expects to report a net profit for 2012 after
posting a loss the year before.
Mainland media also reported on Monday that Beijing is
working out a plan to help the sector involving tax and other
CSCL's shares jumped 3.9 percent in Hong Kong, but finished
just shy of their close last Tuesday. It is now up 19.7 percent
this year after jumping 26 percent in 2012. Its Shanghai shares
surged the maximum 10 percent on Monday.
But Deutsche Bank's China shipping analyst said that CSCL's
profit should still exceed expectations. CSCL is DB's top pick
in the sector.
According to Thomson Reuters StarMine, DB's Sky Wu is the
second-most accurate analyst in forecasting CSCL's earnings.
Also strong were China Vanke's A and
B share listings in Shenzhen. They each soared the
maximum-allowed 10 percent after the country's largest property
developer by sales announced plans to be the second firm to
leave the mainland's moribund B-share market.
Vanke's Shenzhen shares were trading on Monday for the first
time since they were suspended on Dec. 26. Shares in Vanke's
Hong Kong-listed subsidiary Vanke Properties Overseas Ltd
, formerly known as Winsor Properties, surged 12.8
The move for CSCL was one of a few driven by corporate
earnings concerns, which are expected to dominate proceedings in
the near term as investors see if the recovery in the world's
second-largest economy translates into high company
ZTE Corp shed 1.4 percent in Hong Kong,
but rose 1.7 percent in Shenzhen after China's second-largest
telecom equipment maker issued a profit warning for 2012.
This contrasted with its larger rival, unlisted Huawei
Technologies, which bounced back from a disappointing
2011 with a 33 percent rise in net profit for 2012, and forecast
stronger revenue growth, buoyed by smartphone sales and cloud
Chinese telcos were broadly weaker after China Unicom
, the country's second-largest mobile provider,
reported fewer 3G new subscriptions in December than in
In Hong Kong, China Unicom slipped 0.8 percent, while China
Mobile inched down 0.4 percent and China Telecom
shed 1.1 percent.