Profit-taking caps Hong Kong stocks, offsets strong inflows from China

Television Broadcasts

14/02/2017 08:08

Feb 14 (Reuters) - Hong Kong stocks ended little changed on 
Tuesday as growing profit-taking after a two-month rally offset 
sustained inflows from mainland Chinese investors. 
    Both the benchmark Hang Seng index  .HSI  and the Hong Kong 
China Enterprises Index  .HSCE  closed a sliver lower at 
23,703.01 points and 10,254.44 points, respectively. 
    The Hang Seng has risen about 8 percent so far this year, 
riding a wave of optimism that global economic growth is 
improving. 
    The market has also been supported by rising southbound 
inflows through the Shanghai-Hong Kong Stock Connect scheme as 
mainland Chinese investors seek higher returns and a hedge 
against expectations of further depreciation in the yuan 
currency. 
    Over 25 percent of the daily Connect quota was used on 
Tuesday, compared with 25.4 percent on Monday and an average of 
less than 11 percent in January.     
    "Hong Kong listings represent a good bargain for onshore 
investors, who have limited asset classes to invest in," said 
Nomura analysts in a research note. 
    Most sectors retreated on Tuesday, but an index tracking 
services stocks  .HSCIS  gained 2.7 percent. 
    Television Broadcasts Ltd  0511.HK  jumped over 9 percent at 
one point after it said it was cutting the size of a planned 
buyback but raising the offer price, as the broadcaster moved to 
counter a potentially hostile investor.  urn:newsml:reuters.com:*:nL4N1FZ0QL 
    Investors were also awaiting comments by U.S. Federal 
Reserve Chair Janet Yellen later in the day for clues on the 
chance of an interest rate hike in March, which markets now see 
as slight. 
    Higher borrowing costs would weigh on rate-sensitive 
property shares  .HSNP  but benefit the financial sector 
 .HSCIF . Both sectors made modest gains on Tuesday. 
 
 (Reporting by Jackie Cai and John Ruwitch; Editing by Kim 
Coghill) 
 ((Jackie.Cai@thomsonreuters.com; +86 021 6104 1775)) 
 
Keywords: CHINA STOCKS/HONGKONG CLOSE