Chinese Property Mania Sends Real Estate Shares Soaring in HK
Shares in Hong Kong-listed developers shot up today after Wharf Holdings placed the winning bids for two parcels of property in China. The move helps to reaffirm investors' beliefs that bets on Chinese property will pay off in the long term. And that's despite the government's desperate moves to control the ever-rising prices and a study by Renmin University of China saying prices are likely to drop by up to 20% in 2011. Wharf's new purchases total about 1.12 billion RMB ($168 million), and according to China Knowledge, the properties have been earmarked for communities of villas, most probably designed for China's new super-rich. These parcels of land bring Wharf's total land owned in China to more than 110 million square feet.
In China, property prices also got a boost with China Vanke gaining 1.1%, Poly Real Estate advancing 0.9% and Gemdale adding 0.5%.
Chinese power companies rose today with Datang International Power Generation climbing 3% and Huaneng Power International gaining 2.8%.
But gains in Shanghai were tempered by a 10% plunge in Harbin High-Tech Group, a holding company with businesses ranging from processing soybeans and making pharmaceuticals to real estate management. Other losers included Shanghai Fosun Pharmaceutical, which tumbled 2.2% and Harbin Pharmaceutical Group, which dived 1.8%.
In Japan, the upward trend in U.S. spending boosted shares in car makers. Toyota racked up a 2.8% gain, Honda leaped 2.3% and Nissan got a 1.9% boost.
Gaming companies also profited today with Nintendo advancing 2.2%, adding to this week's winning streak. Sony, which makes the competing Playstation 3 console, rose 1.5% while game developer Sega Sammy rocketed up 2.7%. But there were losses too, with Konami, a designer of video game software and arcade games, sinking 0.8% and software developer Square Enix falling 0.6%.