20 August 2019

Policy blessing revs up auto plays

Hong Kong’s benchmark Hang Seng Index (HSI) closed little changed on Tuesday after falling nearly 400 points in the previous session. However, automakers found favor amid efforts by local governments to promote the use of new energy cars.

The HSI ended the day by closing 4 points or 0.02 percent higher at 22,269. The Hang Seng China Enterprises Index, the main gauge for H shares, fell 0.17 percent to finish at 9,520. Shanghai Composite Index rose 0.1 percent to close at 1,999 points.

Auto plays climbed after the China Association of Automobile Manufacturers announced that car sales continued to see double-digit growth in the first two months from a year earlier. Investors also cheered Tianjin’s new energy car policy, which includes subsidies and waiver of licensing fees for buyers of such vehicles. 

Major e-car player BYD (01211.HK) was up 1.4 percent. Dongfeng Motor Group (00489.HK) soared nearly 5 percent and Guangzhou Automobile Group (02238.HK) closed 3.4 percent higher.

Funds also piled into the medicine and healthcare sectors after Sihuan Pharmaceutical Holdings (00460.HK) said its 2013 net profit surged more than 40 percent from the previous year. The counter soared as much as 10 percent before closing 4.4 percent higher.

Buoyed by the news, Shanghai Fosun Pharmaceutical (02196.HK) and CSPC Pharmaceutical Group (01093.HK) ended the day over 6 percent higher.

Shenzhen Neptunus Interlong Bio-Technique (08329.HK) shot up 47 percent after it won regulatory approval for a medicine against stomach cancer.

Meanwhile, snack-foods and beverage manufacturer Want Want China (00151.HK) spiked 4.6 percent after reporting a 23 percent growth in net profit last year.

– Contact the writer at [email protected]



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