* HSI down 0.4 pct on the day, but up 4.7 pct on the month
* CSI300 down 0.1 pct on Thursday, but up 6.5 pct in January
* HSI scores 5th monthly gain, longest winning streak since
* China steel, shipping sectors hit by profit warnings
* Positive profit alerts lift Chinese power producers
By Clement Tan
HONG KONG, Jan 31 Hong Kong shares slipped from
a 21-month high on Thursday, trimming monthly gains, as
investors turned cautious following a batch of profit warnings
and knocked the Hang Seng Index off its most overbought
levels in almost a month.
The Hang Seng Index shed 0.4 percent from Wednesday's
21-month closing high to end at 23,729.5 points, leaving the
benchmark with a gain of 4.7 percent for the month of January.
The HSI has now risen for five straight months, equaling a
winning streak between March and July in 2009 and the longest
since an eight-month string between March and October 2007.
Onshore Chinese benchmark indexes had a tepid January
finish, as investors rotated into shares of power producers and
out of the property sector ahead of the release of China's
January official purchasing managers' index on Friday.
The CSI300 of the top Shanghai and Shenzhen
A-share listings slipped 0.1 percent on the day, but jumped 6.5
percent on the month. The Shanghai Composite Index ended
up 0.1 percent on Thursday and 5.1 percent in January.
The China Enterprises Index of the top Chinese
stocks in Hong Kong slid 0.3 percent on the day, but climbed 6.1
percent this month. Losses in Hong Kong came in the third-worst
turnover this month. Shanghai volumes stayed fairly robust.
"We went a little overbought in Hong Kong yesterday, so we
are correcting from that," said Alex Wong, director of asset
management at Ample Finance. "At this point, investors are
opting for earnings safety, so it's not helping shipping and
Chinese steel and shipping firms dominated the more than 10
profit warnings posted by Hong Kong-listed companies overnight,
while Chinese power producers were lifted by another positive
profit alert for the sector.
Aggravating jitters about the steel sector, the China Iron
and Steel Association (CISA) said on Thursday that 2012 profits
reported by its members, which include more than 70 large steel
mills, slumped 98 percent to 1.6 billion yuan ($257.2 million).
Angang Steel dived 5 percent in Hong
Kong and 2.7 percent in Shenzhen to their lowest in a month
after it estimated net 2012 losses at 4.2 billion yuan and
warned its A-shares could be delisted following two straight
China Shipping Development Co Ltd
tumbled 4 percent in Hong Kong after it warned of a sharp fall
in 2012 net profit. Its larger bulk shipping rival China Cosco
warned of a net loss late last Friday.
CNOOC Ltd slid 2.3 percent after the Chinese oil
giant said it plans to boost spending to produce up to 2 percent
more in 2013, below a five-year average growth target,
highlighting the need for the state giant to make acquisitions.
Chinese property developers slid after local media reported
that the Beijing city government had submitted a property tax
plan to the State Council for approval.
China Vanke tumbled 5.2 percent in Shenzhen,
while Poly Real Estate slumped 6.2 percent in
Shanghai on fears that the imposition of property taxes in
Beijing, one of China's largest cities, will hurt demand.
Rising home prices have elevated fears of more government
curbs on the sector, but Chinese property shares jumped on
Wednesday as investors welcomed a domestic news report that the
central government could tolerate an increase of up to 10
percent in home prices.
BRIGHT SPOTS ABOUND
In a sign that investors are positioning themselves in
sectors that will likely not disappoint in the upcoming
earnings season, Datang International Power
spiked 6.9 percent in Hong Kong and 3.4 percent in Shanghai
after saying it expects 2012 net profit to more than double from
the previous year.
Even excluding a one-off gain related to disposal of its
Shanxi power plant, Deutsche Bank analysts see Datang's net
profit largely in-line with consensus, while top-ranked Thomson
Reuters StarMine analysts were below consensus going into
Wednesday's profit announcement.
Further gains for Datang and other Chinese power producers
could be driven by analysts' upgrades in the near term.
Chinese media reported that the State Council has approved
an energy consumption target that aims to keep energy
consumption below 4 billion metric tonnes of standard coal
equivalent by 2015, with electricity consumption below 6.15
Shares of China Unicom were also stronger, gaining
1.6 percent after the company said it expects 2012 net profit to
rise more than 50 percent from a year earlier.
Thursday's tepid end marked a second-straight monthly gain
for onshore Chinese stock markets that have bounced more than 20
percent from a Dec. 3 nadir.
Mainland Chinese fund managers boosted their recommended
equity weightings in January to a 27-month high on optimism over
the economic outlook and prospects of continued capital inflows,
the latest Reuters fund poll showed.