The Hong Kong stock market has finished lower in two of three trading days since the end of the two-day winning streak in which it had gathered more than 120 points or 0.6 percent. The Hang Seng Index settled just below the 21,220-point plateau, and now traders are expected to go hunting for bargains when the market opens on Tuesday.
The global forecast for the Asian markets is cautiously optimistic after most of the regional bourses saw heavy selling in the previous session. The markets may benefit from a pullback in the price of crude oil, as well as news that Germany's lower house of parliament passed a second Greek bailout package. Upbeat economic data from the United States adds to the positive sentiment. The European markets finished lower and the U.S. bourses were mixed but little changed, and the Asian markets are called slightly higher.
The Hang Seng finished modestly lower on Monday following losses from the financial shares and retailers.
For the day, the index retreated 189.00 points or 0.88 percent to finish at 21,217.86 after trading between 21,076.52 and 21,589.02 on volume of 64.58 billion Hong Kong dollars.
Among the decliners, HSBC shed 1.2 percent, while Hang Seng Bank lost 1.6 percent, Esprit plummeted 3.0 percent and Citic Pacific fell 1.9 percent.
The lead from Wall Street provides little clarity as stocks staged a significant recovery later on Monday after moving sharply lower at the open. Buying interest waned thereafter, however, and the markets eventually ended the session roughly flat.
Renewed concerns about the financial situation in Europe contributed to the initial weakness on Wall Street, as the G20 called for a further enhancement of Europe's bailout fund before the rest of the G20 nations can consider increasing their contribution to the International Monetary Fund's resources.
Upbeat housing data contributed to the subsequent recovery, as the National Association of Realtors reported that its pending home sales index rose by more than expected in January, reaching its highest level since April 2010. NAR said its pending home sales index rose 2.0 percent to 97.0 in January from a downwardly revised 95.1 in December. Economists had been expecting to index to increase by about 1.5 percent.
While the markets also benefited from a pullback by the price of crude oil as well as news that Germany's lower house of parliament voted in favor of a second Greek bailout package, traders seemed somewhat reluctant to continue buying stocks in afternoon trading.
Among individual stocks, Transocean (RIG) rose by 5.3 percent after reporting a fourth quarter loss of $18.62 per share, including items that impacted results by $18.80 per share. Operating revenues rose to $2.42 billion from $2.13 billion a year earlier.
Home improvement retailer Lowe's (LOW) also closed higher after reporting fourth quarter earnings of $0.26 per share on revenues of $11.6 billion. The results exceeded estimates. The company also updated its 2012 guidance, forecasting earnings of $1.75 to $1.85 per share on 1 to 2 percent sales growth.
Once again, the Dow reached an intraday high above 13,000 but ended the session modestly lower. While the Dow edged down 1.44 points or less than a tenth of a percent to 12,981.51, the NASDAQ inched up 2.41 points or 0.1 percent to 2,966.16 and the S&P 500 rose 1.85 points or 0.1 percent to 1,367.59.
On the corporate scene, HSBC Holdings on Monday reported 2011 pre-tax profit of $21.87 billion, up from $19.04 billion a year ago. Results for the latest year included $3.9 billion of favorable fair value movements on the company's own debt attributable to credit spreads, compared with a negative movement of $63 million in 2010.
Underlying profit before tax was $17.7 billion, down $1.2 billion on 2010, due to higher costs which were partly offset by a significant improvement in loan impairment charges and other credit risk provisions. Profit attributable to shareholders rose to $16.8 billion from $13.16 billion last year. Earnings per share totaled $0.92, up 26 percent from a year earlier.
Also, China Yuchai International's fourth-quarter 2011 total net profit attributable to shareholders slipped to RMB 342.6 million or RMB 9.19 per share from RMB 448.9 million, or RMB 12.05 per share in the prior-year quarter. Net revenue for the 2011 fourth quarter was RMB 3.75 billion or $594.61 million compared with RMB 3.79 billion or $601.1 million in 2010.
by RTT Staff Writer
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