X factor provides the right numbers

Business | Samantha Wong and Agencies 13 Sep 2017

The Hang Seng Index was steady yesterday, inching up 17 points to 27,972. Most attention was on shares of mobile phone-related companies, which rose on the strength of the launch of "iPhone X."

So the index stayed close to its two- year high point rather than joining most Asian exchanges in steep climbs after New York stocks surged overnight.

Strength in consumer and resource shares were offset by declines in property developers and airlines, which benefit from a strong yuan. Investors backed off after Beijing unveiled measures to discourage one-way bets on yuan appreciation.

Standout action saw shares of lens maker Q Technology (1478) rising 9 percent after trading resumed in the afternoon after a morning halt for the exchange to process inside information. It closed at HK$15.40.

From January to August, Q Technology recorded 115.7 million shipments of camera module units - a 11.6-percent increase on 12 months earlier. But the firm lowered its sales target from 25 percent to 10 percent to cope with higher production standards, which require more labor and equipment.

Meanwhile, China's central bank lowered its official yuan mid-point to 6.5277 to the US dollar, snapping an 11-day upward streak. That was 280 pips or 0.43 percent weaker than Monday's fix of 6.4997, reflecting weakness in the spot yuan and overnight dollar movements in global markets.

The move in official guidance was the biggest one-day weakening in percentage terms since January 9.

But Premier Li Keqiang said the economy will maintain its momentum and that the leverage ratio has "decreased somewhat" as authorities push on with a drive to reduce financial risk, according to Bloomberg.

And IMF managing director Christine Lagarde said China is making big efforts to rein in financial risk, talking of an "incredible re-balancing" of the economy from industrial to services and technology.

China has spent generously to ensure the economy is holding up when the 19th party congress convenes next month.

The IMF said expansion is likely to remain unchanged this year at 6.7 percent.

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