BEIJING: China’s stocks rose for a third day amid speculation phone-related companies will benefit from Qualcomm Inc.’s settlement with regulators and as consumer shares rallied ahead of the Chinese New Year holiday.
Hisense Electric Co. surged 10 percent to lead gains for consumer companies reliant on economic growth. ZTE Corp. advanced the most in three weeks after China’s antitrust regulator fined Qualcomm a record $975 million for practices it said hurt consumers.
The Shanghai Composite Index rose 0.5 percent to 3,157.70 at the close, the highest level in a week. Trading volumes continued to slump before the Chinese holiday, falling 48 percent from the 30-day average. The festival starts on Feb. 18 and lasts for a week.
“Trading will be light in the few days leading up to the Chinese New Year and the market is kind of in a holiday mode,” said Wu Kan, a fund manager at Dragon Life Insurance Co. in Shanghai. “Consumer companies are set to benefit most because of the holiday effect.”
The CSI 300 Index rose 0.8 percent. Hong Kong’s Hang Seng China Enterprises Index slipped 0.3 percent at 3:20 p.m., while the Hang Seng Index slid 0.8 percent. The Bloomberg China-US Equity Index added 0.3 percent in New York on Tuesday.
The Shanghai index has gained 50 percent over the past year, the second-best performer among 93 global benchmarks tracked by Bloomberg, spurred by monetary easing speculation, an exchange link with Hong Kong and growth in margin trading. The gauge is valued at 11.8 times 12-month projected earnings, compared with the five-year average of 10.3, according to data compiled by Bloomberg.
