HONG KONG: Hong Kong stocks expanded on recent gains early Tuesday, but the advance appeared to be capped by investors’ caution ahead of earnings from several major blue chips later this week.
The Hang Seng Index HSI, +0.36% rose 0.2% in early trade, extending a three-day winning streak, helped by a 0.6% rise for Chinese online major Tencent Holdings Ltd. 0700, +0.22% TCEHY, +2.63% — the index’s second-largest component — ahead of its earnings results due Wednesday. Major insurer Ping An Insurance Group Co. 2318, +1.45% PNGAY, +4.58% 601318, +2.01% and telecoms giant China Mobile Ltd. 0941, +0.88% CHL, -0.16% rose 0.5% and 0.4%, respectively, with both companies scheduled to release annual results Thursday. China Railway Construction Corp. 1186, +5.95% 601186, +5.55% CWYCF, +3.42% jumped 4.8%, and China Railway Group Ltd. 0390, +4.10% 601390, +5.01% CRWOF, +2.63% rallied 4.3%, after state media reported the central government is considering a merger of the two in order to avoid cut-throat competition between them and to increase their market power. Meanwhile, major power producer Huaneng Power International Inc. 0902, +6.78% HUNGF, +3.36% 600011, +2.04% surged 6.4%, after official data showed China’s electricity usage increased 2.5% year-on-year for the first two months of 2015. Rivals also saw substantial gains, with both China Power International Development Ltd. 2380, +5.08% and Huadian Power International Corp. 1071, +4.90% HPIFY, +0.00% climbing more than 3.7%. However, state-owned energy giant PetroChina Co. 0857, -0.61% 601857, +0.54% PTR, -0.12% retreated 1%, due to the slide in international crude prices and news that the general manager of its parent company was under investigation. Also declining, shares of Samsonite International SA 1910, -1.98% SMSOF, -4.45% lost 1.6% following the luggage maker’s earnings, which showed 2014 profit growth of less than 6%. Over on the Chinese mainland, the Shanghai Composite Index SHCOMP, +1.09% also extended gains by 0.6%, after surging 2.3% a day earlier in reaction to Premier Li Keqiang’s remarks over the weekend that China would step up efforts to bolster economic growth if the slowdown affects employment and income.
