Hong Kong shares up on bullish bank outlook; China ups

HONG KONG/SHANGHAI: Hong Kong stocks rose on Friday, buoyed by a bullish outlook from Industrial and Commercial Bank of China and a spurt of corporate takeover talk in the financial sector, while foreign-currency-denominated B shares jumped to an 18-month high in China on speculative trade.

ICBC rose 2 per cent to HK$6.80 after its chairman said he expected the non-performing loan situation in China's banking sector to improve next year as Chinese companies climbed out of the global economic crisis.

Taifook Securities gained 6.59 per cent to HK$4.85 after rising as much as 9.9 per cent to its highest since January 2008. Reuters reported on Thursday that China Construction Bank was in talks to buy control of the brokerage to give it a solid footing in Hong Kong's lucrative retail securities market.

Bank of East Asia, Hong Kong's No.5 bank, was the top loser among index heavyweights after the lender said it was not in talks on a potential acquisition.
The stock fell 3.67 per cent to HK$32.80.

Rumours that Malaysian conglomerate Guoco Group could be interested in BEA had sent the bank's shares up 26 per cent in the last two days.

The Shanghai Composite Index ended at 3,187,647 points, reversing losses early in the session and securing a 0.7 per cent gain for the week. Gaining Shanghai A shares outnumbered losers by 601 to 270 while turnover rose to 163 billion yuan ($23.88 billion) from Wednesday's 144 billion yuan. Shanghai's index of US dollar-denominated B shares ended up 9.42 per cent at 251.192 points, close to its 10 per cent daily limit, while volume nearly tripled from the previous day to $326.5 million on the thinly traded market. Changlin Co advanced 3.29 per cent to 6.60 yuan while Qingdao Soda Ash Industrial climbed 5.47 per cent to 7.13 yuan.