HONG KONG: Shares of mainland banks jumped yesterday on news of strong loan growth of 6.5 trillion yuan in the first six months of 2009, sending the Hang Seng Index up to 18,059.55 points at the close. Property stocks also advanced with revived activities in the property market.

Newly issued bank loans on the mainland may total 6.5 trillion yuan in the first half compared with 5.83 trillion yuan in the first five months of the year, the Shanghai Securities News reported, citing unidentified sources.

Industrial & Commercial Bank of China Ltd, the world's largest lender by value, rose 3.3 percent to HK$5.36. Bank of Communications Co, a lender partly owned by HSBC Holdings Plc, jumped 4.8 percent to HK$7.80. Bank of China Ltd, the nation's third-largest lender, added 2 percent to HK$3.56.

The Hang Seng Index climbed 138.62 points, or 0.8 percent, to 18,059.55 at the close yesterday. The Hang Seng China Enterprises Index, which tracks H shares of mainland companies, advanced 1.2 percent to 10,638.80 points.

"Any weakness should be used as an opportunity to buy because earnings are recovering and economies will recover over the next 12 to 18 months," Khiem Do, head of the multi-asset group at Baring Asset Management (Asia) Ltd, said in an interview with Bloomberg Television.

The benchmark Hang Seng Index has soared 59 percent from a more than four-month low reached on March 9 on speculation government stimulus efforts worldwide will revive the global economy. Shares on the gauge are valued at 16.3 times estimated earnings, up from 10.8 times at the beginning of this year.

Sun Hung Kai Properties, the world's biggest developer by value, rose 3.4 percent to HK$92.85. The company generated HK$100 million ($12.9 million) from the sale of five premium residences at the weekend and will start marketing regular apartments at its Sha Tin project, the Standard reported.

Sino-Ocean Land Holdings Ltd jumped 5.3 percent to HK$8.37 after saying a unit will issue 2.6 billion yuan of six-year bonds to develop property and repay debt. Cheung Kong (Holdings) Ltd, the property developer controlled by billionaire Li Ka-shing, gained 3.4 percent to HK$88.90 after Morgan Stanley lifted the stock's price estimate by 18 percent.

"We are now in a liquidity-driven market where investors are no longer risk averse, so they will continue to push stocks higher and higher," said Ben Kwong, chief operating officer at brokerage KGI Asia Ltd. "There has been quite a dramatic change in attitudes as investors have become greedier and look for higher returns."

China Daily - Bloomberg

(HK Edition 06/23/2009 page4)