Hong Kong Shares May Start Higher After Summers Pulls Out Of Fed Race

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Hong Kong shares could start the week stronger on Monday, taking their cue from gains in regional stock markets after Lawrence Summers dropped out from the race to head the U.S. Federal Reserve.

File photo of Hong Kong Exchanges and Clearing Chairman Arculli and CEO Li hitting gong on first trading day after Lunar New Year holidays at   the Hong Kong Stock Exchange

Hong Kong shares could start the week stronger on Monday, taking their cue from gains in regional stock markets after Lawrence Summers dropped out from the race to head the U.S. Federal Reserve.

A likely uptick in mainland China markets could further underpin sentiment, particularly after the country's securities regulator told a regular news briefing after markets shut last Friday that it would support banks issuing preferred shares and that any "qualified" Chinese company is eligible.

The Hang Seng Index closed down 0.2 percent at 22,915.3 points on Friday, rising 1.3 percent on the week. The China Enterprises Index of the top Chinese listings in Hong Kong sank 0.9 percent, but climbed 2 percent last week.

Shares rallied in Asia on Monday after Summers' surprise decision, as investors wagered that Fed policy would stay easier for longer under the other main candidate, Janet Yellen.

Around 0051 GMT, South Korea's KOSPI was up 1 percent and Australia's S&P/ASX index added 0.7 percent. Markets in Japan were closed for a holiday.

FACTORS TO WATCH:

* China will invest 80 billion yuan ($13.07 billion) in oil and gas exploration in 2013, state media said on Sunday, as it tries to boost energy supplies to reduce its dependence on energy imports.

* Addax Petroleum, owned by top Chinese refiner Sinopec , has lost a ruling at an international tribunal as part of a $1 billion legal battle over an oilfield in Gabon, a confidential document showed.

* Tencent Holdings Ltd, one of China's biggest Internet companies with a market cap of almost $100 billion, has applied for a private banking license, Chinese media reported on Friday.

* Sunshine Oilsands Ltd said the Alberta government had given final approval for its Thickwood Project, doubling the company's Steam Assisted Gravity Drainage (SAGD) commercial production capacity from the current 10,000 barrel per day.

* China National Materials Co Ltd said its subsidiary Gansu Qilianshan Cement Group Co Ltd would buy a 100 percent stake in cement maker Longnan Runji Cement Co Ltd for 265.6 million yuan, a move that will help Qilianshan increase its market share and competitiveness in southern Gansu Province.

* Metallurgical Corporation of China Ltd said the value of newly signed contracts from January to August amounted to 142.73 billion yuan, down 11 percent from the same period a year ago.

* China Coal Energy Co Ltd said its commercial coal production volume for August rose 7.5 percent to 9.8 million tonnes while coal sales volume rose 18 percent to 13.28 million toonnes.

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