Hong Kong Stocks Climb; Cnooc, China Mobile Rise on Profit

By Hanny Wan

Aug. 27 (Bloomberg) -- Hong Kong's stocks rose to the highest in more than a week, led by oil producers, on speculation Cnooc Ltd. will today report a surge in first-half profit.

Cnooc, China's third-largest oil company, climbed 3.2 percent before announcing earnings and after crude prices advanced. China Cosco Holdings Co., Asia's largest shipping company by market value, added 2.3 percent after saying first- half profit more than doubled.

China Mobile Ltd. advanced 1 percent ahead of its earnings announcement. The company reported during the lunchtime trading break that first-half profit advanced 45 percent, beating analysts' estimates.

After positive earnings reports, ``markets are getting a technical rebound in the short-term,'' said Carmen Au-Yeung, a portfolio manager at Comgest (Far East) Ltd. in Hong Kong, which manages the equivalent of $12 billion in global equities. ``There are many stocks that are becoming attractive.''

The Hang Seng Index added 148.14, or 0.7 percent, to 21,204.80 at the 12:30 p.m. break, its highest since Aug. 14. The measure has fallen 24 percent this year on concern soaring inflation and $500 billion in writedowns and credit losses at global financial companies will slow economic and profit growth.

Credit Suisse Group lifted its 12-month estimate for the Hang Seng Index to 27,600, Peggy Chan and Vincent Chan, analysts at the brokerage, wrote in a report today. Credit Suisse's end- 2008 estimate for the gauge was previously 26,100, according to a July 23 research note.

The Hang Seng China Enterprises Index, which tracks so- called H shares of Chinese companies, rose 1.6 percent to 11,585.81.

Cnooc added 3.2 percent to HK$11.56. The company increased its reserves and output during the first half as crude prices rose. Net income probably climbed 52 percent to 22.1 billion yuan ($3.2 billion), according to the median estimate of analysts surveyed by Bloomberg News.

China Cosco

Crude oil futures climbed 1 percent to $116.27 a barrel in New York yesterday. The contract was recently at $116.93 in after-hours trading.

PetroChina Co. advanced 2.2 percent to HK$10.18. Asia's biggest oil company may post a 34 percent drop in profit to 54 billion yuan, according to the median estimates of seven analysts.

Cnooc and PetroChina, among the top 10 gainers on the Hang Seng Index, are scheduled to report results today.

China Cosco added 2.3 percent to HK$14.92. The company said yesterday it more than doubled first-half profit to 15.1 billion yuan ($2.2 billion) after buying the world's largest dry-bulk fleet to ship China's surging imports of iron ore and coal.

Record Users

China Mobile advanced 1 percent to HK$94.20. The world's biggest phone company by market value said first-half profit rose 45 percent to 54.8 billion yuan after price cuts helped attract record numbers of subscribers. That beat the 52.4 billion yuan median estimate of seven analysts in a Bloomberg survey.

More than five stocks on the 43-member Hang Seng Index advanced for every three that dropped. August futures climbed 0.4 percent to 21,160.

The following stocks were among the biggest winners and losers. Stock symbols are in parenthesis after company names.

China Eastern Airlines Corp. (670 HK) slipped 4 cents, or 2.4 percent, to HK$1.66. The country's third-largest carrier said yesterday first-half profit fell 29 percent to 41.6 million yuan as it carried fewer passengers and paid more for jet fuel.

China Yurun Food Group Ltd. (1068 HK) added 20 cents, or 1.6 percent, to HK$12.84. The country's biggest hog processor said yesterday first-half profit surged 71 percent to HK$672 million ($86 million) as it sold more chilled pork and processed meat products. That beats the HK$405 million median estimate of three analysts surveyed by Bloomberg.

Dah Chong Hong Holdings Ltd. (1828 HK) surged 14 cents, or 6.9 percent, to HK$2.17, its sharpest jump since Jan. 25. The Hong Kong-based car and food distributor said yesterday first- half profit climbed 38 percent to HK$289 million. The company said it plans to buy stakes in Toyota Motor Corp. and Lexus brand dealers in China.

Jiangxi Copper Co. (358 HK) advanced 32 cents, or 2.8 percent, to HK$11.86. China's second-biggest smelter of the metal increased first-half profit by 32 percent to 2.77 billion yuan because of a surge in byproduct prices, the company said yesterday.

Sinofert Holdings Ltd. (297 HK), China's biggest fertilizer importer, added 14 cents, or 3.2 percent, to HK$4.54 after saying yesterday first-half profit may double as it increased sales and raised prices. The company didn't provide the profit figure.

To contact the reporter on this story: Hanny Wan in Hong Kong at hwan3@bloomberg.net.