Hong Kong, China stocks gain

Hong Kong and China shares finished higher on Tuesday, helped by banks ahead of earnings this week, and stronger oil markets, but investors remained wary of geo-political risks. The benchmark Hang Seng Index rose 0.76 percent to 22,857.90, while the China Enterprise Index climbed 1.09 percent.
The Shanghai Composite Index, China's main stock index, closed up 0.3 percent at 2,919.1 points. The financial sub-index closed up 1.3 percent as investors snapped up bank shares before earnings announcements begin later this week for the country's biggest banks.
Trading volumes were low in Hong Kong on Tuesday as investors remained cautious in the face of worries in Japan, North Africa and Middle East. But the same concerns supported oil counters as they outperformed, with CNOOC Ltd gaining 3 percent and PetroChina Co Ltd 2.6 percent on the day.
Investors anticipate a spike in demand to compensate for the loss of nuclear capacity in Japan and on continuing tensions in North Africa and the Middle East. In the short-term, 23,000 is the upside resistance for the Hang Seng Index, with its 200-day moving average, currently at 22,377.93, its downside support, analysts said.
Range-bound, speculative trading will continue to dominate until there is more clarity, they said. Hong Kong property stocks continued the recent bearish trend, weighed by accelerating inflation, rising property prices, as well as the initial hikes in mortgage rates by Hong Kong banks.
These are looming policy risks that have not yet been priced into the valuation of Hong Kong property stocks compared to its China counterparts, said Wee Liat Lee, head of regional property research at Samsung Securities in Hong Kong. Hang Lung Properties Ltd and Sun Hung Kai Properties Limited were among the top losers, shedding 0.9 percent apiece.
Chinese banking counters closed up as earnings came into focus, with Bank of China Ltd the first of the lot, on Thursday. In a note released on Tuesday, Barclays Capital tipped Bank of China and Industrial and Commercial Bank of China Ltd (ICBC) to be top performers. ICBC rose almost 1 percent in Hong Kong and 0.5 percent in Shanghai, while Bank of China gained 0.7 percent in Hong Kong and 0.6 percent in Shanghai.
Cement stocks surged on Tuesday as investors bought into shares of companies expected to produce affordable housing and hydroelectric power projects in China, Zhang added. Anhui Conch Cement Co Ltd rose 4.8 percent and Tangshan Jidong Cement Co Ltd jumped 5.8 percent.
China's largest aluminium producer Aluminium Corporation of China Ltd ended down 1.2 percent on overproduction concerns after China's daily aluminium production rose more than 12 percent in February compared with the same month last year.