Taiwan-linked shares soar on Beijing support
Updated: 2008-12-23 07:16
By Lillian Liu(HK Edition)
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Taiwan-related shares outperformed the stock market in Hong Kong yesterday on expectations that Taiwanese firms on the mainland will ride out global financial storm with the support from the mainland authorities.
On Sunday Taiwan Affairs Office of the State Council proposed 10 measures in support of Taiwan-funded enterprises including issuing bank loans and increasing collaborations in the agricultural sector.
"The 130-billion yuan loan from mainland banks will benefit Taiwan-related firms and boost investor confidence," said an analyst.
A wide range of Hong Kong-listed Taiwan and related stocks, including fast-food makers, contract manufacturers and financial service providers all recorded robust increase.
Yue Yuen Industrial (Holdings) Ltd, a Taiwanese shoe maker, led the rally, surging 13.57 percent to HK$16.9.
The company, making shoe products for well-known brand names such as Puma, Adidas and Timberland, recorded 22 percent jump in sales for November.
The investment bank Morgan Stanley, supported by the satisfactory sales, voted it "buy" with a target price of HK$24.6.
Hong Kong-listed Taiwan lender, Fubon Bank, soared 6.15 percent to close at HK$2.6.
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Hong Kong-listed Taiwan lender, Fubon Bank, soars 6.15 percent to close at HK$2.6 yesterday. The mainland's commitment to support Taiwan firms on the mainland caused a rebound for Hong Kong-listed Taiwan firms yesterday. Bloomberg |
TPV Technology Ltd, the world's biggest contract maker of computer monitors, extended 2.22 percent and closed at HK$2.3.
Foxconn International increased 0.37 percent to HK$2.71. Investors' interest also increased in stocks that might benefit from closer economic partnership across the Strait. Shares in Fujian Holdings advanced 21.3 percent to HK$0.37.
Food maker Uni-President was up by 1.6 percent to HK$1.9 while shares in Tingyi, a cup noodle maker, remained unchanged.
Hong Kong stocks retreated on concerns that the regional heavyweight lenders may report more writedowns amid the global financial turmoil.
HSBC Holdings Plc, Europe's biggest bank, dropped 3.3 percent and led declines among financial companies, after Standard & Poor's gave the lender a "negative" outlook.
China Construction Bank, the nation's second largest lender, declined 4.6 percent. Cosco Pacific Ltd, Asia's No 3 container-terminal operator, sank 8.2 percent as shipping fees retreated.
The benchmark Hang Seng Index lost 505.12, or 3.3 percent, to 14,622.39, the lowest close since Dec 5. The measure has lost 47 percent in 2008, on course for its worst annual performance since 1974, as the global financial crisis dragged economies worldwide into recessions.
The Hang Seng China Enterprises Index, which tracks Hong Kong-listed mainland companies, tumbled 3.5 percent to 8,138.42.
CITIC Pacific retreated HK$0.75, or 8.7 percent, to HK$7.85, after having surged 28 percent last week.
The company won shareholders' approval for a HK$11.6 billion convertible bonds sale to its parent. Shareholders voted 99.9 percent in favor of the proposal, which will also have parent CITIC Group assume HK$11.3 billion of currency losses on behalf of the unit, the company said on Dec 19.
(HK Edition 12/23/2008 page3)