China stocks open strongly on finance rally, Hong Kong disagrees

domingo 30 de noviembre de 2014 23:38 GYT

* Mainland markets rally in early morning led by banks

* China published draft plan for deposit insurance Sunday

* Mainland, Hong Kong markets pricing difference widening

By Pete Sweeney

SHANGHAI, Dec 1 (Reuters) - China and Hong Kong stocks were mixed on Monday as investors took divergent views on the implications of a deposit insurance draft plan, with bank shares in Shanghai rising even as Hong Kong traders continued to sell them off.

China issued draft regulations on Sunday to introduce a bank deposit insurance system for the first time, the latest in a series of steps to fully liberalise interest rates and allow banks to compete on a wholly commercial basis.

The difference of investor opinion over the consequences was highlighted by an index measuring price premiums and discounts between dual-listed companies in Shanghai and Hong Kong , which rose 2.5 percent on Monday to 109.28, its highest level since July 2013.

A value above 100 indicates Shanghai shares are pricing at a premium to shares in the same company trading in Hong Kong, and vice versa.

For example, the price of Bank of China's Shanghai listed shares stood at 3.36 yuan, compared with its Hong Kong share price at HK$3.97, equivalent to 3.1472 yuan as of 11:07 a.m., an implied discount of 6.3 percent.   Continuación...