2014.08.1501:05:22UTC+00Hong Kong stocks rise on good bank shares, China Mobile

Hong Kong stocks climbed with its benchmark index continuing the weekly advance as banking shares went up along with China Mobile Ltd.

The Hang Seng Index added 0.5% to 24,917.28, 9:32 am, Hong Kong time. The gauge is approaching a total of 2.3% increase for the week. The H-share Index or the Hang Seng China Enterprises Index also advanced with a 0.3% gain to 11,106.27. The H-share Index has already rebounded from the year’s low in March by a total of 20% up until the previous trading day. The gauge was trading at 7.7 times estimated earnings versus the Hang Seng Index’s 11.5 times. The S&P 500 traded at 16.4. The fluctuation in the Chinese market has been attributed to several factors including the ongoing geopolitical tension in Ukraine, the corporate earning report season, and most recently, the data of Chinese industrial report and retail sales output that missed estimates spurring speculations that policy makers will add measures to keep stimulus for the economic growth.

China Mobile Ltd. is the world’s largest company based on its users. The telecommunications giant led the gains in the market as it amassed an added 2% after announcements that it will cut $2 billion from the company’s device subsidy budget. This is due to the report that wireless carriers would be lowering marketing expenses as requested by government regulators. Credit Suisse Group raised the stocks rating to outperform while Citigroup Inc. increased its price target from HK$90 to HK$100.

China Securities Journal reporter, Ren Xiao believes that China will most likely not make an “across-the-board interest rate or reserve requirement ratio cut” for the remaining half of the year. Xiao adds in the commentary that the central bank will rely on targeted rate cuts instead for shantytown redevelopment, the small companies, and the agriculture sector.